Question: 5. Problem 8.11 (CAPM and Required Return) ELE eBook B Problem Walk-Through Calculate the required rate of return for Mudd Enterprises assuming that investors expect

5. Problem 8.11 (CAPM and Required Return) ELE eBook B Problem

5. Problem 8.11 (CAPM and Required Return) ELE eBook B Problem Walk-Through Calculate the required rate of return for Mudd Enterprises assuming that investors expect a 4.8% rate of inflation in the future. The real risk-free rate is 2.0%, and the market risk premium is 6.5%. Mudd has a beta of 1.6, and its realized rate of return has averaged 13.0% over the past 5 years. Round your answer to two decimal places. %

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