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The expected return on a security, according to the CAPM, is 12.98%, the beta of the security is 1.52 and the risk-free rate is 1%.

The expected return on a security, according to the CAPM, is 12.98%, the beta of the security is 1.52 and the risk-free rate is 1%. What is the value of the risk premium?

a.

8.88%

b.

6.88%

c.

11.98%

d.

7.88%

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