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An analyst uses the security market line (SMI) to determine if stocks are undervalued or overvalued. He recently conducted an analysis of mid-cap company, named

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An analyst uses the security market line (SMI) to determine if stocks are undervalued or overvalued. He recently conducted an analysis of mid-cap company, named Apollo Tractor Supplies (AIS). He calculated the expected retum of AIS and for the browd market index: 0,p/0 Forecasted return for ATS Standard deviation for ATS Expected return on the stock market index ==10%=15%12%0:p Standard deviation on the stock market index =20%

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