Explain expected return on the market portfolio

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A particular stock sells for $30. The stock's beta is 1.25, the risk-free rate is 4%, and the expected return on the market portfolio is 10%. If you forecast that the stock will be worth $33 next year (assume no dividends), should you buy the stock or not? (Show your work. Label %. One decimal place required.)

Reference no: EM132932922

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