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Stock R's beta = 1.5 Stock S's beta = 0.75 Consider that the required return on an average stock is 14 percent. The risk-free rate

Stock R's beta = 1.5
Stock S's beta = 0.75
Consider that the required return on an average stock is 14 percent. The risk-free rate of return is 6 percent. If this is so, the required return on the riskier stock exceeds the required return on the less risky stock by how much?
= 6% + 1.5*(14-6) 12.06
= 6% + 0.75*(14-6) 6.06
Diff. in required return(s) 6.00
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