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Consider the following simplified APT model: Factor Market Interest rate Yield spread Expected Risk Premium (3) 6.0 -0.2 Stock P (61) Factor Risk Exposures Interest

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Consider the following simplified APT model: Factor Market Interest rate Yield spread Expected Risk Premium (3) 6.0 -0.2 Stock P (61) Factor Risk Exposures Interest Rate Vield Spread (62) (63) -1.6 0 0.7 0.9 1.6 0. 0.6 Calculate the expected return for each of the stocks shown in the table above. Assume rp=4.2% (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Expected return P Expected rolum P2 Expected return P3

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