Calculation of fair rate of return by using capm

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Reference no: EM1332972

a. Compute a fair rate of return for Intel common stock, which has a 1.2 beta. The risk-free rate is 6 percent, and the market portfolio (New York Stock Exchange stocks) has an expected return of 16 percent.

b. Why is the rate you computed a fair rate?

Please show all calculations, formulas, and details and send it via Word document.

Reference no: EM1332972

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