Multiple Choice
Assume that the risk-free rate of return is 4%, and the expected return on the market portfolio is 10%. If the systematic risk inherent in the stock of ABC Corporation is 1.80, using the Capital Asset Pricing Model (CAPM) calculate the expected return of ABC.
A) 14.0%
B) 14.8%
C) 16.0%
D) 16.8%
Correct Answer:
Verified
Correct Answer:
Verified
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