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19 Assume that the CAPM is a good description of stock price returns. change the expected retums of the following stocks: The market expected return
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Assume that the CAPM is a good description of stock price returns. change the expected retums of the following stocks: The market expected return is 8% with 12% volatility and the risk-free rate is 3%. New news arrives that does not change any of these numbers, but it does Expected Return 8% 13% 7% 10% Volatility 28% 40% 20% 32% Stock Taggart Transcontinental Rearden Metal Wyatt Oil Nielson Motors Beta 1.2 1.7 0.8 1.3 Which of the following stocks represent selling opportunities? O A. 2 and 4 only O B. 1 and 2 only O C. 1 only O D. 2 and 3 onlyStep by Step Solution
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