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Bsize = Size beta Bvalue = value beta RMRF= return on a market weighted equity index in excess of the one month T-bill rate. SMB=

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Bsize = Size beta Bvalue = value beta RMRF= return on a market weighted equity index in excess of the one month T-bill rate. SMB= small minus big, a size (market capitalization factor). SMB is the average return on three small-cap portfolios minus the average return on three large cap portfolios. HML= high minus low. HML is the average return on two low book-to-market portfolios minus the average return on two high low book-to-market portfolios. Test your cost of equity macro function using the following data: Risk-free rate =4.5%, Market Beta=1.25, Size Beta=-0.225, Value Beta=-0.348 RMRF=5.52%, SMB= 2.74%, HML=4.53%

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