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Assume we are living in a world where CAPM is valid. If market volatility is equal to 20% and he market return is equal to
Assume we are living in a world where CAPM is valid. If market volatility is equal to 20% and he market return is equal to 6.5%. Stock XYZ has a total volatility equal to 20%, a firm specific volatility equal to 5%. What should be XYZ return if the risk free rate is equal to 1%? Select one: O 6.57% 6.15% 5.89% None of the given choices is correct 6.32%
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