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Stock Y has a beta of 1.2 and an expected return of 15.3 percent. Stock Z has a beta of .8 and an expected return of 10.7 percent. If the risk-free rate is 6 percent and the market risk premium is 7 percent, the reward-to-risk ratios for Stocks Y and Z are and the SML reward-to-risk is percent, respectively. Since percent, Stock Y is and Stock Z is (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Stock Y has a beta of 1.2 and an expected return of 15.3 percent. Stock Z has a beta of .8 and an expected return of 10.7 percent. If the risk-free rate is 6 percent and the market risk premium is 7 percent, the reward-to-risk ratios for Stocks Y and Z are and the SML reward-to-risk is percent, respectively. Since percent, Stock Y is and Stock Z is (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Essentials Of Investments
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
Section: Chapter Questions
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Stock Y has a beta of 1.2 and an expected return of 15.3 percent. Stock Z has a beta of .8 and an expected return of 10.7 percent. If the risk-free rate is 6 percent and the market risk premium is 7 percent, the reward-to-risk ratios for Stocks Y and Z are and the SML reward-to-risk is percent, Stock Y is and Stock Z is (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) percent, respectively. Since
Transcribed Image Text:Stock Y has a beta of 1.2 and an expected return of 15.3 percent. Stock Z has a beta of .8 and an expected return of 10.7 percent. If the risk-free rate is 6 percent and the market risk premium is 7 percent, the reward-to-risk ratios for Stocks Y and Z are and the SML reward-to-risk is percent, Stock Y is and Stock Z is (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) percent, respectively. Since
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