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Question 9 (7 points) Assume the risk free rate is 5% and the expected rate of return on the market is 15%. Tam buying a

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Question 9 (7 points) Assume the risk free rate is 5% and the expected rate of return on the market is 15%. Tam buying a firm with an expected perpetual cash flow of $1,000 but unsure of its risk. If I think the beta of the firm is zero, when the beta is really 0.5, how much more will I offer for the firm than it is truly worth? $10.000 $7,576 $20.000 $16.667

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