Question: Bust 9 % 10 9'6 7 % Boom 25 28 20 Required: a. Find the beta of each stock. b. If each scenario is equay

Bust 9 % 10 9'6 7 % Boom 25 28 20

Bust 9 % 10 9'6 7 % Boom 25 28 20 Required: a. Find the beta of each stock. b. If each scenario is equay likely, nd the expected rate of return on the market portfolio and on each stock. it. If the Tbl rate is 3%, what does the CAPM say about the fair expected rate of return on the two stocks? :1. Which stock seems to be a better bug.r on the basis of your answers to (a) through (c)

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