Asset y has a beta of 1.2. The risk-free rate of return is 4 percent,
Asset y has a beta of 1.2. The risk-free rate of return is 4 percent, while the return on the market portfolio of assets is 10 percent. What is the market risk premium?
A) 6%
B) 10%
C) 11.2%
D) 13.2%
E) 8%
ANSWER
A
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