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The required return on the total stock market or S&P 500 index of stocks is 12%. The risk-free interest rate or T-Bill rate is 4%.

The required return on the total stock market or S&P 500 index of stocks is 12%. The risk-free interest rate or T-Bill rate is 4%. Compaq stock has a Beta of 1.5. Investors should thus require a return of on Compaq stock, based on the Capital Asset Pricing Model (CAPM)

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