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Systematic versus Unsystematic Risk [ LO 3 ] Consider the following information about Stocks I and II: table [ [ table [ [
Systematic versus Unsystematic Risk
LO Consider the following
information about Stocks I and II:
tabletableState ofEconomytableProbabilityofState ofEconomytableRate ofReturn ifState OccurtableStockIecessionormaltablerrationalexuberance
The market risk premium is percent, and the riskfree rate is percent. Which stock has the most systematic risk? Which one has the most unsystematic risk? Which stock is "riskier"? Explain.
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