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Peter, an analyst at Fantastique Partners (FP), models the stock of the company. Suppose that the risk-free rate PRF = 6.5%, the required market return

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Peter, an analyst at Fantastique Partners (FP), models the stock of the company. Suppose that the risk-free rate PRF = 6.5%, the required market return rm = 12.5%, the risk premium for small stocks PSMB 3.2%, and the risk premium for value stocks SHML 4.8%. Suppose also that Peter ran the regression for Fantastique Partners's stock and estimated the following regression coefficients: afp = 0.00, MFP 0.9, CFP = 0.2, and dep 0.3. If Peter uses a Fama-French three-factor model, then which of the following values correctly reflects the stock's required return? = 13.98% 7.48% 3.18% 17.94%

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