The unlevered beta of electronics firms, on average, is 1.1. The riskless rate is 6.5%, and the
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The unlevered beta of electronics firms, on average, is 1.1. The riskless rate is 6.5%, and the market risk premium is 6%.
a. Estimate the expected return, using the CAPM.
b. If you are a venture capitalist, why might you have a target rate of return much higher than this expected return?
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a The expected return using the CAPM is 65 116 131 b Venture capitalists typically ...View the full answer
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