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Wilson wants to know how much risk he must take to generate an acceptable return on his portfolio. The risk-free return is 4 percent. The

Wilson wants to know how much risk he must take to generate an acceptable return on his portfolio. The risk-free return is 4 percent. The average stock return (market return) is 12 percent. According to the CAPM model.

What is the cost if the beta is 1.2? What is the cost if the beta is 0.7

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