You are using the CAPM to calculate a fair return for Stardust common stock. The shares have a volatility of 36.00%, while the market has a volatility of 19.00%. The correlation between the two sets of returns is 0.30. The risk free rate is 1.00%, while the expected return on the market is 3.90%. What is the fair return for Stardust common stock?

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Q: 3.21%

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Q: You are using the CAPM to calculate a fair return for Stardust Inc. common stock. The market has a…

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