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(Capital Asset Pricing Model)The expected return for the general market is 12.5 percent, and the risk premium in the market is 7.2 percent. Tasaco, LBM,
(Capital Asset Pricing Model)The expected return for the general market is 12.5 percent, and the risk premium in the market is 7.2 percent. Tasaco, LBM, and Exxos have betas of 0.811 ,0.614 ,0.528 and , respectively. What are the appropriate expected rates of return for the three securities?
The appropriate expected return of Tasaco is
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