please show work 3) Eagle Enterprises has common stock with a beta of 1.25. The expected...

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Question

3) Eagle Enterprises has common stock with a beta of 1.25. The expected return of the market is 10 percent and the risk-free

please show work

Answer 1

Answer #1

Ans 12.00%

Expected Return =	Risk free Return + (Market Return - Risk free return)* Beta
Expected Return =	2% + (10% - 2%) * 1.25
Expected Return =	12.00%

Answer 2

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