A stock has an expected return of 18 percent and a beta of 1.4. The risk-free rate is 3.5 percent.What is the slope of the security market line?O 11.92 percent10.36 percent12.08 percent13.85 percent

Slope of the security market line = (Expected return - Risk free rate) / Beta

Answered: A stock has an expected return of 18…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter2: Risk And Return: Part I

Section: Chapter Questions

Problem 12P: Stock R has a beta of 1.5, Stock S has a beta of 0.75, the expected rate of return on an average...

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A stock has an expected return of 18 percent and a beta of 1.4. The risk-free rate is 3.5 percent. What is the slope of the security market line? O 11.92 percent 10.36 percent 12.08 percent 13.85 percent