Determining the expected return of market


An analyst at Jiang invesments, LLC, is analyzing an investment with perpetual cash flows of $ 2,000. The analyst is unsure of investment risk; if she believes the beta to be 1 when it is actually 0, what is the difference in valuation for each investment? Assume the risk free rate is the 5% and the expected return of the market is 11%

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Finance Basics: Determining the expected return of market
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