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Suppose you manage a $5.11 million fund that consists of four stocks with the following investments: Stock Investment Beta A $460,000 1.50 B 500,000 -0.50
Suppose you manage a $5.11 million fund that consists of four stocks with the following investments:
Stock | Investment | Beta | |
A | $460,000 | 1.50 | |
B | 500,000 | -0.50 | |
C | 1,500,000 | 1.25 | |
D | 2,650,000 | 0.75 |
If the market's required rate of return is 12% and the risk-free rate is 6%, what is the fund's required rate of return?
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