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Question 3 Consider the following information describes the expected return and risk relationship for three stocks: Beta Expected Return Standard Deviation Twitter LLC 12.35% 13%
Question 3 Consider the following information describes the expected return and risk relationship for three stocks: Beta Expected Return Standard Deviation Twitter LLC 12.35% 13% 1.3 Tik Tok Inc 14.49% 16% 1.65 Facebook 12.39% 9.95% 0.85 4.95% Market Risk Premium Risk Free 7.67% Rate a) Using CAPM, calculate the Expected Return for each Stock. (15 Marks) b) As an investment advisor, which stock will you recommend for investment and why
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