Question: The Treasury bill rate is 6%, and the expected return on the market portfolio is 12%. According to the capital asset pricing model a. What
The Treasury bill rate is 6%, and the expected return on the market portfolio is 12%. According to the capital asset pricing model a. What is the risk premium on the market? b. What is the required return on an investment with a beta of 1.7? (Do not round intermediate calculations. Enter your answer as a percent rounded to 1 decimal place.) c. If an investment with a beta of 0.7 offers an expected return of 9.3%, does it have a positive or negative NPV? d. If the market expects a return of 11.4% from stock X, what is its beta? (Do not round intermediate calculations. Round your answer to 2 decimal places.) a. Market risk premium b. Return on investment NPV Beta C. d
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