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ID Question 7 5 pts Correlation Hope Mexico World Std%) Required return Hope 1 0.7 0.5 20% 22 Mexico 1 0.8 16% 12% World 1

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ID Question 7 5 pts Correlation Hope Mexico World Std%) Required return Hope 1 0.7 0.5 20% 22 Mexico 1 0.8 16% 12% World 1 12% 10% Suppose that the Mexican stock market is segmented from the rest of the world. Using the CAPM and a risk-free rate of 5%, estimate the equity cost of capital for Hope O 10,035% 12.1005 O 11125% O 15.450X

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