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J&J common stock has a beta of 0.60, while P&G common stock has a beta of 1.5. The expected return on the market is 14%
J&J common stock has a beta of 0.60, while P&G common stock has a beta of 1.5. The expected return on the market is 14% and the risk-free rate is 4%. Based on the capital asset pricing model (CAPM) and making use of the information, the required return on the J&J common stock should be ____, and the required return on P&G common stock should be ____.
A.10%; 21%. B.9%; 18%. C.12%; 24%. D.10%; 19%.
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