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A stock has a beta of 2 . 1 , the expected return on the market is 9 . 2 % and the risk -
A stock has a beta of the expected return on the market is and the riskfree rate is Based on it's current price, the stock has an expected return of Based on the predictions of the CAPM, how would you describe this stock?
a Underpriced.
b Overpriced.
c Correctly priced.
d Impossible to say without knowing the price of the stock.
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