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Stock P has an expected return of 19 percent and a beta of 1.6. Stock R has an expected return of 10.5 percent and a

Stock P has an expected return of 19 percent and a beta of 1.6. Stock R has an expected return of 10.5 percent and a beta of 0.8. Both stocks have the same reward-to-risk ratio. What is the risk-free rate?

2.00 percent

4.26 percent

1.77 percent

3.50 percent

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