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The beta coefficient for the company has been 1.28. The company believes that 18% percent is a reasonable estimate of the market return on stocks

The beta coefficient for the company has been 1.28. The company believes that 18% percent is a reasonable estimate of the market return on stocks in general for the foreseeable future and that the risk-free rate is 12%. Compute the required rate of the return for equity based on the beta coefficient by using the CAPM approach.

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