You have the following information about the returns for the shares of Super Lux plc and the

Question:

You have the following information about the returns for the shares of Super Lux plc and the returns for the market:

Given that the rate of return on Treasury bills is 8 per cent and that the correlation coefficient between the returns on Super Lux's shares and the market is +0.83, calculate the required rate of return on Super Lux's shares using the CAPM.

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Corporate Finance Principles and Practice

ISBN: 978-1292103037

7th edition

Authors: Denzil Watson, Antony Head

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Question Posted: Apr 14, 2017 12:03 PM

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You have the following information about the returns for the shares of Super Lux plc and the

Question:

Return of the market (%) Return of Super Lux (96) 18 21 20 25 26 Time 10 8 12 14

Step by Step Answer:

We need to determine s and m in order to calculate the beta of Super Lux Rs 18 21 20 25 265 22 ...View the full answer

Corporate Finance Principles and Practice

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