Given the capital asset pricing model, a security with a beta of 1.5 should retu

Question

Given the capital asset pricing model, a security with a beta of 1.5 should return what, if the risk-free rate is 6% and the market return is 11%? Answer 15.0% 14.0% 14.5% 13.5% 15.5% Given the capital asset pricing model, a security with a beta of 1.5 should return what, if the risk-free rate is 6% and the market return is 11%? Given the capital asset pricing model, a security with a beta of 1.5 should return what, if the risk-free rate is 6% and the market return is 11%? 15.0% 14.0% 14.5% 13.5% 15.5% 15.0% 14.0% 14.5% 13.5% 15.5%

Explanation / Answer

Using calm model return = risk free return + beta( market return- risk free return)

Therefore 6 + 1.5(11-6) = 13.5

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