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14) A common stock of 3M has an expected rate of return of 13% and a beta of 1.15. The risk-free rate is 5%, and

14) A common stock of 3M has an expected rate of return of 13% and a beta of 1.15. The risk-free rate is 5%, and the market expected rate of return is 15%. According to the capital asset pricing model (CAPM), 3ms stock is ________.

Select one:

a. underpriced

b. fairly priced

c. indifferently priced

d. overpriced

e. none of these answers

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