Assume that the risk-free rate is 5% and the market risk premium is 6%, what is the expected return for the overall stock market? What is the required rate of return that has a beta of 1.2?© BrainMass Inc. brainmass.com June 3, 2020, 11:04 pm ad1c9bdddf
The return can be calculated using the CAPM equation
Expected return = Rf + (Rm-Rf) ...
The solution explains how to calculate the required rate of return given the beta