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A stock has an expected return of 17.5 percent.  The beta of the stock is 2.83 and...

A stock has an expected return of 17.5 percent.  The beta of the stock is 2.83 and the
risk-free rate is 2.9 percent.  What is the market risk premium?
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Answer #1

Ans 14.60%

Market Risk Premium = Market Expected Return - Risk Free Rate

                                 = 17.5% - 2.9%

                                 = 14.60%

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