Question: Consider the following information describes the expected return and risk relationship for three stocks: Beta Expected Return Standard Deviation Wysinco 13.6% 18.8% 1.1 Lasco 12.9%

Consider the following information describes the expected return and risk relationship

Consider the following information describes the expected return and risk relationship for three stocks: Beta Expected Return Standard Deviation Wysinco 13.6% 18.8% 1.1 Lasco 12.9% 16.1% 1.6 Seprod 9.86% 12% 0.95 8% 2) Market Risk Premium Risk Free 9% Rate a) Using CAPM, calculate the Expected Return for each Stock. (20 Marks) b) As an investment advisor, which stock will you recommend for investment and why

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