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A stock has a beta of 1.4. Assume that the market return is 13% and the risk-free rate is 2%. If the stocks actual return

A stock has a beta of 1.4. Assume that the market return is 13% and the risk-free rate is 2%. If the stocks actual return is 18%? the stock is:

above the Security Market Line

below the Security Market Line

on the Security Market Line

it cannot be determined

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