Assume stock A has beta equal to 1.2 and stock B has beta equal to 0.92,...
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Assume stock A has beta equal to 1.2 and stock B has beta equal to 0.92, if the expected rate of return for the market is 10% and risk-free rate is 3%. Which stock has higher expected rate of return? You can calculate or simply choose one of them and explain why it is higher. Assume stock A has beta equal to 1.2 and stock B has beta equal to 0.92, if the expected rate of return for the market is 10% and risk-free rate is 3%. Which stock has higher expected rate of return? You can calculate or simply choose one of them and explain why it is higher.
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Answer rating: 100% (QA)
The CAPM formula is as follows Expected Return RiskFree Rate Beta Market Return ... View the full answer
Related Book For
Fundamentals of Financial Management
ISBN: 978-0324302691
11th edition
Authors: Eugene F. Brigham, ? Joel F. Houston
Posted Date:
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