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Calculate the Expected Return on Stock Y

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Reference no: EM132534476

Questions -

Q1) Explain what is meant by the term Equity Beta and explain how it is calculated and the information it provides.

Q2) The Beta of stock X is 1.2 and the Beta of stock Y is 0.8. The expected return on stock X is 12.2%, while the risk free rate is 5%.

a. Calculate the Expected Return on Stock Y.

b. Explain the use of the Capital Asset Pricing Model (CAPM).

Reference no: EM132534476

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