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(b.) Suppose you have two risky assets and asset 2 is 30 more risky than asset 1 . Assume that asset 1 has a beta
(b.) Suppose you have two risky assets and asset 2 is \30 more risky than asset 1 . Assume that asset 1 has a beta of 1 and the expected returns of the two assets are 5\\% (asset 1) and 8\\% (asset 2). (i.) if the risk-free rate is \1 and asset 1 is correctly priced according to the CAPM, explain what you would do. (ii.) if asset 1 and asset 2 are correctly priced according to the CAPM, what would the risk-free rate be
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