Exhibit 14 -Refer to Exhibit 14

question 123

Multiple Choice

Exhibit 14.11
Use the Information Below for the Following Problem(S)
$\begin{array}{lcc}\text { Investment } & \text { Beta } & \text { Analyst's Estimated Return } \\\hline \text { Stock } \mathrm{X} & 2.3 & 15.5 \% \\\text { Stock } \mathrm{Y} & 1.2 & 13.6 \% \\\text { Market Portfolio } & 1.0 & 11.5 \%\end{array}$

-Refer to Exhibit 14.11.What is the required rate of return for Stock Y based on the capital asset pricing model (CAPM) ?

• A) 11.5%
• B) 13.0%
• C) 13.6%
• D) 14.8%
• E) 15.5%