Question
Security T21.5 T13.6 Beta 2.26 0.83 Expected return 21.5 13.6 I. If the current market data indicates that the risk-free rate is 3.96 percent, are
| Security | T21.5 | T13.6 |
| Beta | 2.26 | 0.83 |
| Expected return | 21.5 | 13.6 |
I. If the current market data indicates that the risk-free rate is 3.96 percent, are these securities correctly priced?
II. What would the risk-free rate have to be if these securities are correctly priced?
III. If these two securities are correctly priced ( the findings of II. ) find the market risk premium
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Handbook Of Recent Advances In Commodity And Financial Modeling
Authors: Giorgio Consigli, Silvana Stefani, Giovanni Zambruno
1st Edition
3319613189, 978-3319613185
