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Stock A has a beta of 1.5 and the variance of its return is .4. Stock B has a beta of 2 and the variance

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Stock A has a beta of 1.5 and the variance of its return is .4. Stock B has a beta of 2 and the variance of its return is . 3 . Which of the following is true? According to CAPM, stock A should have the same expected rate of return as stock B. Stock B has more unique risk than stock A. Investors will demand a higher return for stock A, because it is the riskier one. Stock A has more unique risk than stock B

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