Question
Suppose the rate of return on short-term government securities (perceived to be risk-free) is about 5%. Suppose also that the expected rate of return required
Suppose the rate of return on short-term government securities (perceived to be risk-free) is about 5%. Suppose also that the expected rate of return required by the market for a portfolio with a beta of 1 is 12%. According to the CAPM:
What is the expected rate of return on the market portfolio?
what would be the expected rate of return on a stock with beta = 0?
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Project Financing Financial Instruments And Risk Management
Authors: Frank J Fabozzi, Carmel De Nahlik
1st Edition
9811231494, 9789811231490
