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You are planning to purchase shares at AMDEX Ltd. You expect a return on the market of 9% and the risk-free rate to be 4%.

You are planning to purchase shares at AMDEX Ltd. You expect a return on the market of 9% and the risk-free rate to be 4%. The beta for AMDEX shares is 1.25 and the forecast return for AMDEX shares is 8.2%. Would you buy the shares? Explain your answer with relevant calculations and diagrams.

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