As an equity analyst, you have developed the following return forecastsand risk estimates for two different stock mutual funds (Fund T and Fund U):Forecasted Return CAPM BetaFund T9.00%1.20Fund U10.00%0.80f the risk-free rate (RFR) is 3.9% and the expected market risk premium (i.e.,E(Ra) – RFR) is 6.1%, calculate the expected return for each mutual fund according to the3.а.САРМ.

As an equity analyst, you have developed the following return forecasts and risk estimates for two different stock mutual funds (Fund T and Fund U): Forecasted Return CAPM Beta Fund T 9.00% 1.20 Fund U 10.00% 0.80 the risk-free rate (RFR) is 3.9% and the expected market risk premium (ie., E(Ra) – RFR) is 6.1%, calculate the expected retun for each mutual fund according to the 3.a. CAPM.

As an equity analyst, you have developed the following return forecasts and risk estimates for two different stock mutual funds (Fund T and Fund U): Forecasted Return CAPM Beta Fund T 9.00% 1.20 Fund U 10.00% 0.80 the risk-free rate (RFR) is 3.9% and the expected market risk premium (ie., E(Ra) – RFR) is 6.1%, calculate the expected retun for each mutual fund according to the 3.a. CAPM.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 6P

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