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Business, 18.01.2020 04:31 gonsalex6688

Company a has a beta of 0.70, while company b's beta is 1.20. the required return on the stock market is 11.00%, and the risk-free rate is 4.25%.
what is the difference between a's and b's required rates of return?
(hint: first find the market risk premium, then find the required returns on the stocks.)

a) 2.75% b) 2.89% c) 3.05% d) 3.21% e) 3.38%

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