The market’s expected total return is 10% pa and the risk free rate is 5% pa, both given as effective annual rates. A stock has a beta of 0.

The market’s expected total return is 10% pa and the risk free rate is 5% pa, both given as effective annual rates. A stock has a beta of 0.7. In the last 5 minutes, bad economic news was released showing a higher chance of recession. Over this time the share market fell by 2%. The risk free rate was unchanged. Calculate the stock’s historical return over the last 5 minutes, given as an effective 5 minute rate?

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