Question
(SML) The following table shows the beta of each stock. If the expected market return is10%and the risk-free interest rate is4%, according to the SML
(SML) The following table shows the beta of each stock. If the expected market return is10%and the risk-free interest rate is4%, according to the SML equation (from CAPM), the expected return of Microsoft is% _______.
| Stock | Beta |
| 0.1 | |
| Microsoft | 1.4 |
| GM | 9.1 |
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Principles of Corporate Finance
Authors: Richard Brealey, Stewart Myers, Franklin Allen
11th edition
978-9332902701, 9332902704, 978-0078034763
