Question
The risk-free rate, kRF, is 2.4 percent and the market risk premium, (kM - kRF), is 5 percent. Assume that required returns are based on
The risk-free rate, kRF, is 2.4 percent and the market risk premium, (kM - kRF), is 5 percent. Assume that required returns are based on the CAPM. Your $1 million portfolio consists of $ 635 ,000 invested in a stock that has a beta of 1.0 and the remainder invested in a stock that has a beta of 1.4 . What is the required return on this portfolio?
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Real Estate Finance and Investments
Authors: William Brueggeman, Jeffrey Fisher
14th edition
73377333, 73377339, 978-0073377339
