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C. Suppose the fund manager receives a proposal for a new stock. The investment needed to take a position in the stock is $60 million;
C. Suppose the fund manager receives a proposal for a new stock. The investment needed to take a position in the stock is $60 million; it will have an expected return of 24%, and its estimated beta coefficient is 1.5. Should the new stock be purchased? (Hint: Compute required return for the stock.)
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The Bank Credit Analysis Handbook
Authors: Jonathan Golin, Philippe Delhaise
2nd Edition
0470821574, 978-0470821572
