Stock a has a beta of 4 and investors expect it to return 8, Ask an Expert

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Stock A has a beta of .4, and investors expect it to return 8%. Stock B has a beta of 1.6, and investors expect it to return 14%. Use the CAPM to calculate the market risk premium and the expected rate of return on the market. (Do not round intermediate calculations. Enter your answers as a whole percent.) Market risk premium % Expected market rate of return %

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Financial Management, Finance

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