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The expected return for the general market in France is 12.8%, and the risk premium in that market is 4.3%. Alinghi Ltd., a company listed

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The expected return for the general market in France is 12.8%, and the risk premium in that market is 4.3%. Alinghi Ltd., a company listed on the French Stock Exchange has a beta of 0.82. Required: a) What is the corresponding required rate of return for Alinghi Ltd. shares? (2 marks) b) What is the major assumption that allows investors to use beta instead of standard deviation as the relevant measure of risk for a proposed investment in Alinghi Ltd. shares

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