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Determining the expected market return

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What can you conclude from the CAPM equation below?

The 10-year bond yield in the U.S. is 2%. The beta of the Apple Inc is 1.35. The expected market return based on the S&P 500 Index is 14%. Using CAPM - R(a) = 0.02 + 1.35[0.14 - 0.02] = 18.20%. The expected return on the Apple stock is 18.20%

Reference no: EM133075041

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