7. Consider the Fama-French 3-factor model. The risk-free rate is 1% and the expected return on the market is 11%. The stock's market beta is 1, SMB beta is 0.5 and HML beta is -0.5. Etw) and E('s) are 6% and 7%, respectively. The stock's expected return is 12%. Relative to the Fama-French 3-factor model, the stock has and is 1) Positive alpha, undervalued 2) Positive alpha, overvalued 3) Negative alpha, undervalued 4) Negative alpha, overvalued 7 . Dan