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The risk-free rate is 6 percent and the expected market risk premium is 8 percent. What is the expected rate of return on a stock

The risk-free rate is 6 percent and the expected market risk premium is 8 percent. What is the expected rate of return on a stock with a beta of 0.7?

  1. 11.6 percent
  2. 9.8 percent
  3. 15.8 percent
  4. 14.0 percent
  5. 5.6 percent

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