What would be the stock new required rate of return

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Reference no: EM132054481

Suppose the risk free rate=6%, required return on the market =11% and the required return on the stock is 14%.

A. Please calculate beta of the stock from the information above.

B. If the beta of the stock increased to 1.90, what would be the stock’s new required rate of return? Why are the two returns not proportional, or are they?

Reference no: EM132054481

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