Suppose two factors are identified for the u. s. economy: the growth rate of industrial production, ip, and the inflation rate, ir. ip is expected to be 6% and ir 7%. a stock with a beta of 1 on ip and 0.7 on it currently is expected to provide a rate of return of 15%. if industrial production actually grows by 7%, while the inflation rate turns out to be 9%, what is your best guess for the rate of return on the stock?
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Suppose two factors are identified for the u. s. economy: the growth rate of industrial production,...
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