Question
Assume two efficiently-priced securities, X and Y. The expected return on X is 4.80% and it has a beta of 1.38. Y has a beta
Assume two efficiently-priced securities, X and Y. The expected return on X is 4.80% and it has a beta of 1.38. Y has a beta of 2.29. The market risk premium is 4.00%. What is the expected return for security Y?
a.
8.44%
b.
7.34%
c.
9.96%
d.
13.96%
e.
3.28%
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Multinational Business Finance
Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett
14th edition
133879879, 978-0133879872
