Question: Using the formula for the capital market line (Formula 175 on page 448), if the risk-free rate (RF) is 8 percent, the market rate of

Using the formula for the capital market line (Formula 17–5 on page 448), if the risk-free rate (RF) is 8 percent, the market rate of return (MK) is 12 percent, the market standard deviation ((M) is 10 percent, and the standard deviation of the portfolio ((P) is 12 percent, compute the anticipated return (KP).

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