Question: The expected return on a security, according to the CAPM, is 13.46%, the beta of the security is 1.76 and the risk-free rate is 1.19%.

The expected return on a security, according to the CAPM, is 13.46%, the beta of the security is 1.76 and the risk-free rate is 1.19%. What is the value of the risk premium?

6.97%

5.78%

8.16%

12.27%

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