Question: Problem 12-17 CAPM and Expected Return (LO2) The following table shows betas for several companies. Calculate each stock's expected rate of return using the CAPM.

Problem 12-17 CAPM and Expected Return (LO2) The following table shows

Problem 12-17 CAPM and Expected Return (LO2) The following table shows betas for several companies. Calculate each stock's expected rate of return using the CAPM. Assume the risk-free rate of interest is 9%. Use a risk premium of 11% for the market portfolio. (Do not round Intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Company Caterpillar Cisco Harley- Davidson Hershey Beta 1.26 1.48 Cost of Capital % 0.43 % 0.57 %

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