# Two stocks, A and B, have beta coefficients of 0.8 and 1.4, respectively. If the expected return

## Question:

5 percent, what is the risk premium associated with each stock?

Expected Return

The expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these...

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**Related Book For**

## Basic Finance An Introduction to Financial Institutions Investments and Management

**ISBN:** 978-1111820633

10th edition

**Authors:** Herbert B. Mayo