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CFIN
5th Edition
ISBN: 9781305661639
Author: Scott Besley, Eugene Brigham
Publisher: Cengage Learning
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Question
Chapter 8, Problem 16PROB
Summary Introduction
Here,
The cost of equity or required rate of return is “r”.
The risk-free rate is “
The risk premium is “
The market return is “
The beta coefficient is “
The expected market return is 12.5%, required rate of return is 11%, and beta coefficient is 0.8.
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8-16
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