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You looked up financial information for your favorite company on Yahoo Finance and found out that its stock's Beta is 1.27. The T-Bill rate is
You looked up financial information for your favorite company on Yahoo Finance and found out that its stock's Beta is 1.27. The T-Bill rate is currently around 2.9%. The market risk premium is 10%. This information allows you to calculate exactly how high the required annual return on this company's stock should be that would correctly compensate the investors for the amount of systematic risk that they would be facing when buying this stock. Your calculated required annual return for the company's stock equals _____ percent.
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