Question: [ 1 3 ] Suppose that Ford s stock volatility ( i . e . standard deviation ) is 4 0 % while the market

[13] Suppose that Fords stock volatility (i.e. standard deviation) is 40% while the market volatility is 20%. If the correlation between Ford and the market is 0.8, what is the expected return on Fords stock? Assume that the expected return on the market is 12% and the risk-free rate is 4%.

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