Stock A has a beta of 1.09 while Stock B has a beta of .76 and an expected return of 8.2 percent.What is the expected return on Stock A if the risk-free rate is 4.6 percent and both stocks have equal reward-to-risk premiums?
A) 11.12 percent
B) 8.07 percent
C) 9.76 percent
D) 10.89 percent
E) 11.73 percent
Correct Answer:
Verified
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