Problem 11 Intro Assume that the CAPM holds. One stock has an expected return of 9% and beta of 0.5. Another stock has an expected return of 13% and a beta of 1.5. Part 1 What is the expected return on the market?

EBK CFIN
6th Edition
ISBN:9781337671743
Author:BESLEY
Publisher:BESLEY
Chapter11: The Cost Of Capital
Section: Chapter Questions
Problem 5PROB
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Problem 11
Intro
Assume that the CAPM holds. One stock has an expected return of 9% and a
beta of 0.5. Another stock has an expected return of 13% and a beta of 1.5.
Part 1
What is the expected return on the market?
3+ decimals
Submit
Transcribed Image Text:Problem 11 Intro Assume that the CAPM holds. One stock has an expected return of 9% and a beta of 0.5. Another stock has an expected return of 13% and a beta of 1.5. Part 1 What is the expected return on the market? 3+ decimals Submit
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