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Problem 7-8 Returns and Premiums At the beginning of the year, you bought three stocks with different betas. The risk-free rate is 2.7%. Unfortunately,
Problem 7-8 Returns and Premiums At the beginning of the year, you bought three stocks with different betas. The risk-free rate is 2.7%. Unfortunately, the market portfolio had a negative return of -6.9% during the year. Market Return -6.9% T-Bill Yield 2.7% A) Suppose that Beta is 0.6. What is the expected return? The expected return is %. Round your answers to the nearest two decimal places. Include a negative sign if the expected return is negative. B) Suppose that Beta is 1.0. What is the expected return? The expected return is %. Round your answers to the nearest two decimal places. Include a negative sign if the expected return is negative. C) Suppose that Beta is 1.5. What is the expected return? The expected return is %. Round your answers to the nearest two decimal places. Include a negative sign if the expected return is negative.
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