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Calculate each stock's required rate of return. Stock X has a 10% expected return, beta coefficient of .9, and 35% Standard deviation of expected returns.
Calculate each stock's required rate of return.
Stock X has a 10% expected return, beta coefficient of .9, and 35% Standard deviation of expected returns. Stock Y has a 12% expected return, a beta coefficient of 1.2, and a 25% Standard deviation. Risk-free rate is 6% and the market risk premium is 5%.
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