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The expected return on the market is 10%, the risk-free rate is 5% and Black Magic Cosmetics Inc. has a beta of -1. What is the expected return for Black Magic Cosmetics Inc.? A. -10% B. -5% C. 0% D. 5% E. 7.5%

The expected return on the market is 10%, the risk-free rate is 5% and Black Magic Cosmetics Inc. has a beta of -1. What is the expected return for Black Magic Cosmetics Inc.? A. -10% B. -5% C. 0% D. 5% E. 7.5%

EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter11: Capital Budgeting And Risk
Section: Chapter Questions
Problem 6P
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What is the expected return for black magic cosmetics inc. On these financial accounting question?

The expected return on the market is 10%, the risk-free rate is 5% and Black Magic Cosmetics Inc. has a beta of -1. What is the expected return for Black Magic Cosmetics Inc.? A. -10% B. -5% C. 0% D. 5% E. 7.5%
Transcribed Image Text:The expected return on the market is 10%, the risk-free rate is 5% and Black Magic Cosmetics Inc. has a beta of -1. What is the expected return for Black Magic Cosmetics Inc.? A. -10% B. -5% C. 0% D. 5% E. 7.5%
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