What is the required return on oilily stock

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The systematic risk (beta) of France's Oilily Corporation is 1.2 when measured against a world stock market index and 1.4 against a French stock index. The annual risk-free rate in France is 5 percent.

a. If the required return on the world market index is 12 percent, what is the required return on Oilily stock in an integrated financial market?

b. Suppose the French financial market is segmented from the rest of the world. If the required return on the French market is 11 percent, what is the required return on Oilily stock?

Reference no: EM13871632

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