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Johnson Manufacturing, Inc., is considering several investments. The rate on Treasury bills is currently 5 percent, and the expected return for the market is 10

Johnson Manufacturing, Inc., is considering several investments. The rate on Treasury bills is currently 5 percent, and the expected return for the market is 10 percent. What should be the expected rate of return for each investment (using the CAPM)?

Security

Beta

A

1.74

B

0.93

C

0.71

D

1.22

Expected rate of return for security A:

Expected rate of return for security B:

Expected rate of return for security C:

Expected rate of return for security D:

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