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The rate of return on a fully diversified portfolio is 10%. Asset A will pay 3,000 in 3 years' time and asset B will pay
The rate of return on a fully diversified portfolio is 10%. Asset A will pay 3,000 in 3 years' time and asset B will pay 3,000 in 2 years' time. The Beta coefficient for asset A is 0.8 and for asset Bis 1.2. According to the CAPM what are the required rates of return on these assets if the risk-free rate of interest is 5%? What are the current market values of these assets
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