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Assume that the risk-free rate of interest is 5% and the expected rate of return on the market is 15%. A stock has a required
Assume that the risk-free rate of interest is 5% and the expected rate of return on the market is 15%. A stock has a required rate of return of 6%. What is its beta? Is the stock a cyclical or defensive stock? Useful formulas: E(rP) = rf + P [E(rM ) rf]
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