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Suppose you manage a $4.175 million fund that consists of four stocks with the following investments:

Stock

Investment

Beta

A

$420,000

 

1.50

B

475,000

 

-0.50

C

1,380,000

 

1.25

D

1,900,000

 

0.75

If the market's required rate of return is 11% and the risk-free rate is 7%, what is the fund's required rate of return? Round your answer to two decimal places.

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