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Which company would you invest in based on this data and why? Capital Asset Pricing Model (CAPM) model based on the proposition that any stocks
Which company would you invest in based on this data and why?
Capital Asset Pricing Model (CAPM) model based on the proposition that any stocks required rate of return is equal to the risk-free rate of return plus a risk premium reflecting only the risk remaining after diversification. The CAPM equation is = ri= rRF + bi (rM -rRF).
Stock | Value Line | Yahoo Finance | Market RiskPremium | Risk Free Rate |
Amazon | 1.2 | 1.39 | 4.7 | 0.7 |
Apple | .95 | 1.34 | 4.7 | 0.7 |
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