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Presently risk-free rate is 10 percent and the expected return on the market portfolio is 15 percent. The return expectations of the market analysts for
Presently risk-free rate is 10 percent and the expected return on the market portfolio is 15 percent. The return expectations of the market analysts for four stocks are listed in the following table with each stock's expected bers. If the expectations of the analysts are correct, which stocks are overvalued and which are undervatuen, if any? llow would the overvalued or undervalued stocks be repositioned on the security market line
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