You are using the CAPM to calculate a fair return for Stardust Inc. common stock. The market has a volatility of 12.00 %, while the shares have a volatility of 11.00 %. The correlation between the two sets of returns is -0.31. The risk free rate is 3.10%, while the expected return on the market is 6.70%. What is the fair return for Stardust common stock? O 1.98% O 2.08% O 1.88% O 1.20%

You are using the CAPM to calculate a fair return for Stardust Inc. common stock. The market has a volatility of 12.00 %, while the shares have a volatility of 11.00 %. The correlation between the two sets of returns is -0.31. The risk free rate is 3.10%, while the expected return on the market is 6.70%. What is the fair return for Stardust common stock? O 1.98% O 2.08% O 1.88% O 1.20%

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 14P

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