The risk free rate on treasury bill is very low right now, Ask an Expert

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The risk free rate on Treasury bill is very low right now. Let's say it is 0.25%, annualized.

Suppose, you also looked up the annual rate of change in the S&P500 market index, and it is 7%.

You are considering a stock with a beta that is 10% less volatile than the overall market beta, which is always presumed to be 1

What is the minimum level of annual return that you would require on this investment? Explain and show calculations using the CAPM.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92085670

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