What are the expected returns for microsoft and apple

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Reference no: EM132045828

Using returns data over the past year, you estimate that Microsoft has a beta of 0.71 and Apple has a beta of 0.74.

If these estimates are a reliable guide for their risks going forward, what rate of return is required for an investment in each stock?

Assume T-bill rate is 1.0%, market risk premium is 6% What are the expected returns for Microsoft and Apple respectively?

Reference no: EM132045828

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