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ve 3.24 The risk-free ering the following investments. free rate is currently 3%, and the market return is 10%. Assume you ar
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a) Most risky was investment E which has a beta of 2.0 and least risky was investment D with a beta of 0.0

Investment beta Re 1.5 13.50% 1.0 10.00% _0.758.25% 03.00% 2 17.00% བ བ པ ས པ ས བ 엉 6 8 10 11 12 Re 13 14 15 16 18.00% 16.00%with increase in risk, there is an expectation of increase in return to compensate for the added risk

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