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ASSUME THAT THE RISK-FREE RATE OF RETURN IS 4%, AND THE EXPECTED RETURN ON THE MARKET PORTFOLIO IS 10%. IF THE SYSTEMATIC RISK INHERENT IN

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ASSUME THAT THE RISK-FREE RATE OF RETURN IS 4%, AND THE EXPECTED RETURN ON THE MARKET PORTFOLIO IS 10%. IF THE SYSTEMATIC RISK INHERENT IN THE STOCK OF ABC CORPORATION IS 1 80, USING THE CAPITAL ASSET PRICING MODEL (CAPM) CALCULATE THE EXPECTED RETURN OF ABC. (DO NOT ROUND INTERMEDIATE CALCULATIONS AND ROUND YOUR PERCENTAGE ANSWER TO 1 DECIMAL PLACE.) Select one: a 14.0% O b. 14.8% c. 16% O d. 16.8% O e NONE OF THESE CHOICES

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