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6. (10 points) Stock Y has a beta of 1.2 and an expected return of 11.4 percent. Stock Z has a beta of .80

6. (10 points) Stock Y has a beta of 1.2 and an expected return of 11.4 percent. Stock Z has a beta of .80 and an expected return of 8.06 percent. If the risk-free rate is 2.5 percent and the market risk premium is 7.2 percent, are these stocks correctly priced?

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