Assuming an equally weighted portfolio including stocks

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Assuming an equally weighted portfolio including the following three stocks (MRK, GOOG and XOM), what should one’s required return be for this portfolio using the Capital Asset Pricing Model? Merck & Co. (MRK)- Beta= 0.50 Google Inc. (GOOG)- Beta= 1.14 Exxon (XOM)- Beta= 0.80 Note: the 10 year Treasury bond yield is 2.71% (proxy for nominal risk-free rate) and the average return on the market, as measured by the S&P500 is 12.11%.

Reference no: EM13929511

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