Question 53 Telco Inc. has a beta of 1.3 and an expected return of 18%. Woollies Co. has a beta of 0.80 and an expected return of 9.5%. If Treasury Bills yield a return of 5% and the market return is 11.75%, which stock is under/overvalued relative to the other? Show why. Answer: Telco is undervalued relative to Woollies