Question: Using the CAPM, estimate the appropriate required rate of return for the three stocks listed here, given that the risk free rate is 0.78%, and

Using the CAPM, estimate the appropriate required rate of return for the three stocks listed here, given that the risk free rate is 0.78%, and the expected return for the market is 6% for the coming year. Stock Beta CAPM = Rf + B*(Rm-Rf) Return Pfizer 0.66 E(Rm)= 6.0% Merck 0.43 RF= 0.78% Eli Lilly 0.27

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