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C) Suppose the current expected return on the market is 16% and the risk free rate is 10%. The estimated return and betas for three

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C) Suppose the current expected return on the market is 16% and the risk free rate is 10%. The estimated return and betas for three stocks are listed below. Which is overpriced? Which is under-priced? (Use may use the CAPM Model) Stocks Franklin Corp. AZZ Corp. BBB Corp. Estimated Return 16% 19% 13 Beta 1.2 1.3 0.75 14

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