The Expected Return on the Market Portfolio Is 13

question 46

Multiple Choice

The expected return on the market portfolio is 13%. The risk free rate is 5%. The beta on GM is 1.1. According to the CAPM, what is the expected return on GM?

• A) 13%
• B) 13.8%
• C) 14%
• D) 15%

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Definitions:

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A systematic and logical approach to discovering how things in the universe work, involving observation, hypothesis formulation, experimentation, and conclusion.

Hypotheses

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