Corporate Investment and Financing

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Two variables or inputs into the application of the Capital Asset Pricing Model to determine the cost of equity for a company are the market risk premium and the beta for the company.  Wal-Mart currently has a beta of .31.  Please give one reason you believe this could be too low or too high.

Two variables or inputs into the application of the Capital Asset Pricing Model to determine the cost of equity for a company are the market risk premium and the beta for the company.  Please give (and then support) what you believe the current market premium to be.

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