The market index has a standard deviation of 22 and the

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Stock Expected Return Beta Firm Specific Standard Deviation

Acme 13% 0.8 30%
Bundu 18% 1.2 40%

The market index has a standard deviation of 22% and the risk free rate is 8%

(a) What are the standard deviations of stocks of Acme and Bundu.

Reference no: EM13566686

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