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Security a Has an Expected Rate of Return of 22

Question 82

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Security A has an expected rate of return of 22% and a beta of 2.5.Security B has a beta of 1.20.If the Treasury note rate is 2.0%,what is the expected rate of return for security B?

Correct Answer:

verifed

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RA = RF + BA(Rm - Rf)
.22 = .0...

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