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Assume that the CAPM holds. Consider two firms X and Y, and the risk-free asset, with the following return characteristics: o cov(ri,r mkt) Eri) 225

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Assume that the CAPM holds. Consider two firms X and Y, and the risk-free asset, with the following return characteristics: o cov(ri,r mkt) Eri) 225 200 7.5 Y 1600 600 rf 0 5 What is the expected return of stock Y

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