Question

You are considering an investment in Citizens Bank Corp. The firm has a beta of 1.6. Currently, U.S. Treasury bills are yielding 2.75% and the expected return for the S & P 500 is 14%. What rate of return should you expect for your investment in Citizens Bank?
A) 11.15%
B) 15.39%
C) 16.75%
D) 20.75%

Answer

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