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Stock A has a beta of 1.8 and an expected return of 12%. Stock B has a beta of 0.7 and an expected return of

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Stock A has a beta of 1.8 and an expected return of 12%. Stock B has a beta of 0.7 and an expected return of 7%. If the risk-free rate is 2% and the expected market return is 8%, what is true about the two stocks? A. Stock A is overpriced and stock B is underpriced B. Both stocks are correctly priced C. Both stocks are underpriced D. Stock A is underpriced and stock B is overpriced E. Both stocks are overpriced

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