Compute kj for the betas


Problem:

Assume that Rf = 5 and Km=10.5 percent. Compute Kj for the following betas, using an increase in interest rates changes Rf to 6.0 percent, and the market risk premium (Km-Rf) changes to 7.0 percent. Compute Kj for the three betas of 0.6, 1.3 and 1.9.

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Finance Basics: Compute kj for the betas
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