The stock of Cleveland-Cliffs Inc. (Ticker: CLF) has a beta of 1.38 and an E(R) = 12.0%. In light of this information and knowing that U.S. T-Bills return 5%, Rm is equal to: a. 8.44 b. 10.07 c. 7.00 d. 12.63 e. 8.38

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Q: Give Step by Step Solution with explanation

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Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.