26. The risk-free rate of return is currently 3.5 percent, whereas the market risk premium is 9 percent. If the beta of Base Inc., stock is 1.25, then what is the expected return on Base Inc.?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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26. The risk-free rate of return is currently 3.5 percent,
whereas the market risk premium is 9 percent. If the beta of
Base Inc., stock is 1.25, then what is the expected return on
Base Inc.?
Transcribed Image Text:26. The risk-free rate of return is currently 3.5 percent, whereas the market risk premium is 9 percent. If the beta of Base Inc., stock is 1.25, then what is the expected return on Base Inc.?
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