Question: 17 (Required rate of return using CAPM) a. Compute a fair rate of return for Intel common stock, which has a 1.7 beta. The risk-free

(Required rate of return using CAPM) a. Compute a fair rate of return for Intel common stock, which has a 1.7 beta. The risk-free rate is 8 percent, and the market portfolio (New York Stock Exchange stocks) has an expected return of 11 percent. b. Why is the rate you computed a fair rate? a. Using the CAPM, the fair rate of return for Intel common stock is %. (Round to two decimal places.) b. Why is the rate you computed in part (a) a fair rate? (Select the best choice below.) O A. The computed 13.10% is a fair rate because it compensates the investor for the time value of money and for assuming risk. O B. The computed 13.10% is a fair rate because it does not compensate the investor for the time value of money and for assuming risk

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