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Suppose that the risk-free rate is 7percent, and a well-diversified portfolio, V, with a beta of 1.3 has a return of 2percent, and another well-diversified

Suppose that the risk-free rate is 7percent, and a well-diversified portfolio, V, with a beta of 1.3 has a return of 2percent, and another well-diversified portfolio, U, with a beta of 0.8 has a return of 1percent. What is the arbitrage opportunity

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