Question: There's a question I don't know how to solve. I've seen it in one of the files here with the correct answer being C but
There's a question I don't know how to solve. I've seen it in one of the files here with the correct answer being C but I don't know how to get that answer, what the steps are.
- Which one of the following shares is correctly priced (rounded up to one decimal place) if the risk-free rate of return is 3.6% and the market rate of return is 10.5%?
A: beta .85 expected return 9.2%
B: b 1.08 expected return 11.8%
C: b 1.69 ER 15.3%
D: b .71 ER 7.8%
E: b 1.45 ER 12.3%
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