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2- Assume that the market has an expected return of 12% and volatility (standard deviation) of 20%. Company X has a 50% volatility (standard deviation). The correlation between the market and Company X is 90%. The risk-free rate is 3%. What would be the expected return on Company X? (Hint: You have to check my lecture note (Lecture Note #10b - Risk and Return: Capital Asset Pricing Model (CAPM)) 23% O 23,25% O 23,50% O 23,75%

2- Assume that the market has an expected return of 12% and volatility (standard deviation) of 20%. Company X has a 50% volatility (standard deviation). The correlation between the market and Company X is 90%. The risk-free rate is 3%. What would be the expected return on Company X? (Hint: You have to check my lecture note (Lecture Note #10b - Risk and Return: Capital Asset Pricing Model (CAPM)) 23% O 23,25% O 23,50% O 23,75%

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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2- Assume that the market has an expected return of 12% and volatility (standard deviation) of 20%. Company X has a 50% volatility (standard deviation). The correlation between the market and Company X is 90%. The risk-free rate is 3%. What would be the expected return on Company X? (Hint: You have to check my lecture note (Lecture Note #10b - Risk and Return: Capital Asset Pricing Model (CAPM)) 23% O 23,25% 23,50% 23,75% Diğer:
Transcribed Image Text:2- Assume that the market has an expected return of 12% and volatility (standard deviation) of 20%. Company X has a 50% volatility (standard deviation). The correlation between the market and Company X is 90%. The risk-free rate is 3%. What would be the expected return on Company X? (Hint: You have to check my lecture note (Lecture Note #10b - Risk and Return: Capital Asset Pricing Model (CAPM)) 23% O 23,25% 23,50% 23,75% Diğer:
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