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28 Sep 2019
Problem 8-10
CAPM and required return
Beale Manufacturing Company has a beta of 1.3, and Foley Industries has a beta of 0.95. The required return on an index fund that holds the entire stock market is 12%. The risk-free rate of interest is 3.75%. By how much does Beale's required return exceed Foley's required return? Round your answer to two decimal places.
Problem 8-10
CAPM and required return
Beale Manufacturing Company has a beta of 1.3, and Foley Industries has a beta of 0.95. The required return on an index fund that holds the entire stock market is 12%. The risk-free rate of interest is 3.75%. By how much does Beale's required return exceed Foley's required return? Round your answer to two decimal places.
Lelia LubowitzLv2
28 Sep 2019