Assuming an equally weighted portfolio including the


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%.

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Financial Management: Assuming an equally weighted portfolio including the
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