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Assume that the risk-free rate is 7%, and the market risk premium is 8%. Also assume that after careful analysis, you believe that FBF Limited

Assume that the risk-free rate is 7%, and the market risk premium is 8%. Also assume that after careful analysis, you believe that FBF Limited ordinary shares will return 17% next year. The beta for the stock is 1.5. You should:

a.

not buy it because it earns more than 7%.

b.

not buy it because it earns less than 19%.

c.

buy it because it earns more than 15%.

d.

buy it because it earns more than 7%.

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