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Beta and required rate of return A stock has a required return of 11 percent; the risk-free rate is 7 percent; and the market risk
Beta and required rate of return A stock has a required return of 11 percent; the risk-free rate is 7 percent; and the market risk premium is 4 percent. a. What is the stock's beta? b. Is the market risk premium increased to 6 percent, what would happen to the stock's required rate of return? Assume the risk-free rate and the beta remain unchanged
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