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Suppose Intel stock has a beta of 1.59, whereas Boeing stock has a beta of 0.82. If the risk-free interest rate is 4.3% and the expected return of the market portfolio is 13.2%, according to the CAPM,
a. 13.2% is the expected return of Intel stock?
b. What is the expected return of Boeing stock?
c. What is the beta of a portfolio that consists of 60% Intel stock and 40% Boeing stock?
d. What is the expected return of portfolio that consists of 60% Intel stock and 40% Boeing stock? (There are two ways to solve this)
e. What is the expected return of Intel stock? Intel's is the expected is %.
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Universal Electronics is considering the purchase of manufacturing equipment with a 10-year midpoint in its asset depreciation range (ADR).
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Alexandria's Dance Studio is currently an all-equity firm with earnings before interest and taxes of $338,000 and a cost of equity of 14.2 percent. The tax rate is 34 percent. Alexandria is considering adding $400,000 of debt with a coupon rate of 7 ..
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