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Suppose r RF = 5.5%, r M = 11.5%, and b K = 0.7. What is...

Suppose r RF = 5.5%, r M = 11.5%, and b K = 0.7. What is r K, the required rate of return on Stock K?

a.

4.20%
b.

17.70%
c.

13.55%
d.

9.70%
e.

8.05%
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Answer #1

Answer 9 = 5.5% 91m = 1/-5% Bk =. 7 IK- ? using CAPM elk = 914 + PK (P1m - 916) where elf is susk free erate Bk is measure of

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