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A stock has a beta of 1.6. The current risk-free rate is 2.5% and the...

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Finance

A stock has a beta of 1.6. The current risk-free rate is 2.5% and the market risk premium is 7.5%. What must the required rate of return for this stock be according to the CAPM theory?

a. 10.0%

b. 10.5%

c. 11.5%

d. 12.0%

e. 14.5%

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