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The Capital Asset Pricing Model is as follows: Expected Return for Security i = risk-free rate + Beta for Security i *(Expected Return on the

The Capital Asset Pricing Model is as follows: Expected Return for Security i = risk-free rate + Beta for Security i *(Expected Return on the Market Porfolio - risk-free rate). The final term in brackets is referred to as "The Market Risk Premium". Global historical data suggests that a reasonable estimate for the Market Risk Premium is ______.

options:

3%

5%

7%

9%

11%

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