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Question
Assume the real rate of return in the economy is 4.25%, the expected rate of inflation is 3.5%, and the risk premium is 6.75%. Compute the risk-free rate and required rate of return.Risk free rate = .079 or 7.9%
or
Rf = 7.75%
Required Rate of Return =.1518 or 15.18%
or
Required Rate of Return = 14.50%
Answer
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Related questions
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