A stock has a beta of 1.25, the expected return on the market is 12 percent, and

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A stock has a beta of 1.25, the expected return on the market is 12 percent, and the risk-free rate is 5 percent. What must the expected return on this stock be? Assume the CAPM holds.

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Corporate Finance

ISBN: 9781259270116

8th Canadian Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Gordon Roberts, Hamdi Driss

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Question Posted: Oct 29, 2020 07:29 AM

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A stock has a beta of 1.25, the expected return on the market is 12 percent, and

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CAPM states the relationship between th...View the full answer

Corporate Finance

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