Question
(Capital Asset Pricing Model)Johnson Manufacturing, Inc., is considering several investments. The rate on Treasury bills is currently 6.5 percent, and the expected return for the
(Capital Asset Pricing Model)Johnson Manufacturing, Inc., is considering several investments. The rate on Treasury bills is currently
6.5
percent, and the expected return for the market is
12.5
percent. What should be the expected rate of return for each investment (using the CAPM)?
| Security | Beta |
|---|---|
| A | 1.75 |
| B | 0.98 |
| C | 0.56 |
| D | 1.44 |
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Fundamentals Of Futures And Options Market
Authors: John C. Hull
6th Edition
0132242265, 9780132242264
