Example 2:CML and SML ▣Scenario l: Security E[R]B A 25%0.8 B 15%1.2 Answer:inconsistent Higher beta requires higher expected return 2010/Yichuan Liu 13Example 2: CML and SML  Scenario I: Security E[R] β A 25% 0.8 B 15% 1.2  Answer: inconsistent Higher beta requires higher expected return 2010 / Yichuan Liu 13