Author Question: In the capital asset pricing model, an increase in inflationary expectations will be reflected by (Read 113 times)

silviawilliams41 · **on:** Apr 25, 2021

Question 1

If Left Bank stock has a beta of 1.25, the return from the market portfolio is 15%, and the Treasury bill return is 5%, what is the required return from the stock?
◦ 17.5%
◦ 12.5%
◦ 16.0%
◦ 7.5%
◦ 15.0%

Question 2

In the capital asset pricing model, an increase in inflationary expectations will be reflected by
◦ a parallel shift downward in the security market line.
◦ a decrease in the slope of the security market line.
◦ an increase in the slope of the security market line.
◦ a parallel shift upward in the security market line.

bobsmith · **Reply #1 on:** Apr 25, 2021

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