Risk premium on the market assuming capm
The expected return on KarolCo. stock is 16.5 percent. If the risk-free rate is 5 percent and the beta of KarolCo is 2.3, then what is the risk premium on the market assuming CAPM is true?
a. 2.5%
b. 5.0%
c. 7.5%
d. 10.0%
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