Using CAPM A stock has an expected return of 15 percent, its beta is 1.45, and the

Question:

Using CAPM A stock has an expected return of 15 percent, its beta is 1.45, and the expected return on the market is 12 percent. What must the risk-free rate be?

Expected Return
The expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these...