The risk-free rate is 1%. The market risk premium is 5%. Your CAPM beta is 1.2....
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The risk-free rate is 1%. The market risk premium is 5%. Your CAPM beta is 1.2. You can invest either in project 1 or in project 2, but not both. Which one do you choose? Time Proj 1 Proj 2 Project 1 Project 2 0 Your Answer: $ (100) $ (70) 1 Answer 10 $ 20 2 $ 20 $ 20 3 30 $ 20 4 40 $ 20 5 $ 50 Question 4 (1 point) Follow up from Q3. What is the minimum value of beta that would lead you to choose project 2? (Round to 3 decimal places) $ 20 The risk-free rate is 1%. The market risk premium is 5%. Your CAPM beta is 1.2. You can invest either in project 1 or in project 2, but not both. Which one do you choose? Time Proj 1 Proj 2 Project 1 Project 2 0 Your Answer: $ (100) $ (70) 1 Answer 10 $ 20 2 $ 20 $ 20 3 30 $ 20 4 40 $ 20 5 $ 50 Question 4 (1 point) Follow up from Q3. What is the minimum value of beta that would lead you to choose project 2? (Round to 3 decimal places) $ 20
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Related Book For
Statistics for Business and Economics
ISBN: 978-0321826237
12th edition
Authors: James T. McClave, P. George Benson, Terry T Sincich
Posted Date:
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