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Intro The table below shows information for 3 stocks. Security Beta Risk-free rate Expected market return Stock 1 17 0.02 Stock 2 1.2 0.035 0.07

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Intro The table below shows information for 3 stocks. Security Beta Risk-free rate Expected market return Stock 1 17 0.02 Stock 2 1.2 0.035 0.07 Stock 3 0.5 0.015 0.07 The risk-free rates are different because they were measured in different years. Calculate the expected (or required) return for each stock, using the Capital Asset Pricing Model (CAPM). Part 1 IB Attempt 1/10 for 9 pts. What is the expected return for stock 1? Part 2 IB Attempt 1/10 for 9 pts. What is the expected return for stock 2? Submit Part 3 - Attempt 1/10 for 9 pts. 4+ decimals

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