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Daniella is looking at two stocks. They have the following beta coefficients: Daniella is estimating that the risk free rate will remain the same and

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Daniella is looking at two stocks. They have the following beta coefficients: Daniella is estimating that the risk free rate will remain the same and that the market risk premium (rMrRF) will increase. If her forecast turns out to be accurate, according to the Security Market Line, which of the following statements is Correct? The required returns of both stocks will increase by the same amount. The required return of Stock MM will decline but the required return of Stock PG will increase. The required return on Stock PG will increase by more than that on Stock MM. The required return on Stock MM will increase by more than that on Stock PG

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