Question: - Problem #4 - Calculating the Expected Rate of Return a) Stock ABC has a beta of 7, the risk-free rate is 3%, and the

- Problem #4 - Calculating the Expected Rate of Return a) Stock ABC has a beta of 7, the risk-free rate is 3%, and the expected market returns are 4%. Using the Capital Asset Pricing Model, what are the expected returns for stock ABC? b) Using CAPM, what is the cost of equity if the risk-free rate is 4%, market return is 6%, and beta is 1.2

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