QUESTION 7 [5 marks] A stock has a beta of 0.5, the risk-free rate of...
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Finance
QUESTION 7 [5 marks]
A stock has a beta of 0.5, the risk-free rate of return is 7% and the market risk premium is 8%. The stock is estimated to earn a return of 10%. Determine the performance of the stock and an appropriate investment strategy to be pursued by a portfolio manager.
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