tudy Tools ns ess Tips ess Tips R YOU BILITY BALL Lower Back Abdominals ctor Spinae ercises: Upper back Ch 08- Assignment - Risk and Rates of Return Stock Beta Standard Deviation Expected Return A 0.5 B C RATE OF RETURN (Percent) 20 An analyst has used market- and firm-specific information to generate expected return estimates for each stock. The analyst's expected return estimates may or may not equal the stocks' required returns. You've also determined that the risk-free rate [TRP] is 4%, and the market risk premium [RPM] is 5%. 18 Given this information, use the following graph of the security market line (SML) to plot each stock's beta and expected return on the graph. (Note: Click on the points on the graph to see their coordinates.) 16 14 A 2 1.0 0 2.0 0 02 23% 38% 45% 0.4 0.0 0.8 1.0 1.2 7.5% 12.0% 14.0% 1.4 1.6 1.6 20 Stock A Stock B Stock C