Security X has an expected rate ofreturn of 13% and a beta of 1.15.The risk-free rate is 4% and the market expected rate of retum is 9%. According to the capital asset pricing model, security X is- A. fairly priced B. overpriced C. underpriced D. None of the above 10. "If the efficient markets hypothesis is true (strong form), managers will not be able to increase stock prices by creative accounting that boosts reported earnings." A. True B. False I1. XYZ Corp. is expected to pay a dividend of $4 in the upcoming year. Dividends are expected to grow at a constant rate of 1 1% per year indefinitely. The risk-free rate of return is 9% and the expected return on the market portfolio is 17%. XYZ stock has a beta of 0.65, what is the value of XYZ? A.9.9 B. 15.87 C. 36.36 D. 125.00 12. The initial margin requirement on a stock purchase is 50% and the maintenance margin is 3 0%. You fully use the margin allowed to purchase 100 shares of XYZ at $25. If the price drop to the margin-call point, your broker will sell just enough of your shares to restore the initial margin broker sell Ignore interest on the loan.) requirement. How many shares will your A. 334 B. 412 C. 462 D. 667 13. The Wilder. Fund sells Class A shares with a front-end load of 5% and Class B shares with a 12b-1 fees of 1% annually. Ifyou plan to sell the fund after 5 years, are Class A or Class B shares the better choice? Assume a 10% annual return net ofexpenses. A. Class A B. Class B C. There is no difference D. There is insufficient information given