Question: What is the return on a stock according to the security market line if the risk-free rate is 6 percent, the return on the market

What is the return on a stock according to the security market line if the risk-free rate is 6 percent, the return on the market is 10 percent, and the stock’s beta is 1.5? If the beta had been 2.0, what would be the return? Is this higher return consistent with the portfolio theory explained in this chapter? Why?

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