Problem

a. Estimate beta for each of the following securities assuming that the standard deviati...

a. Estimate beta for each of the following securities assuming that the standard deviation of returns for the market portfolio (m) is 8.0 percent.

b. Based on the Capital Asset Pricing Model, with a risk-free rate of 7 percent and a market risk premium of 8.8 percent, which of the securities, P, Q, or R (if any) appear to be attractive investments?

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Solutions For Problems in Chapter 8

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