Question
Security X has an expected rate of return of 13% and a beta of 0.7. The risk-free rate is 4%, and the market expected rate
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Security X has an expected rate of return of 13% and a beta of 0.7. The risk-free rate is 4%, and the market expected rate of return is 18%. According to the capital asset pricing model, security X is _________.
underpriced
fairly priced
overpriced
none of these answers
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Focus On Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes, Melissa Hart
7th Edition
1265521972, 978-1265521974
