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Question 12 An analyst has estimated the following information with regards to two stocks X and Y the Market Index and the risk free rate.
Question 12 An analyst has estimated the following information with regards to two stocks X and Y the Market Index and the risk free rate. Annual Return% Std. Deviation% Beta Stock X 12 20 1.3 Stock Y 9 15 0.7 Market Index Risk free rate 0 12 a) Using the data shown above show the equation of the Security Market Line Indicate the position of the SML and stocks X and Y on a graph (an approximation is sufficient, it is not necessary to draw to scale)
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