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If the Riskfree Interest Rate Is 5%, the Market Price

Question 12

Multiple Choice

If the riskfree interest rate is 5%, the market price of risk is 6%, and the beta is 0.5, then, according to the classical single-factor CAPM, what is the equilibrium expected total return for investment in the asset in question?


A) 3%
B) 6%
C) 8%
D) 11%
E) 17%

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