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Assume both portfolios A and B are well diversified, that E ( r A ) = 13.6% and E ( r B ) = 14.4%.

Assume both portfoliosAandBare well diversified, thatE(rA) = 13.6% andE(rB) = 14.4%. If the economy has only one risk factor, andA= 1 while B= 1.1, what must be the risk-free rate?(Do not round intermediate calculations. Enter your answer as a percentage rounded to 1 decimal places.)

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