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Using monthly returns from 1990-2001, you estimate that WalMart's beta is 1.89 (std err = 0.28) and Tiffany's beta is 0.61 (std err = 0.12).

Using monthly returns from 1990-2001, you estimate that WalMart's beta is 1.89 (std err = 0.28) and Tiffany's beta is 0.61 (std err = 0.12). If these estimates are a reliable guide going forward, what expected rate of return should you require for holding each stock? (No calculations are needed beyond multiplication and division to solve). Please show steps

Expected Market Return

Use NPV method to solve

This is a Capital Asset Pricing Model

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