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Stock Y has a beta of 1.20 and an expected return of 13.8 percent. Stock Z has a beta of .85 and an expected
Stock Y has a beta of 1.20 and an expected return of 13.8 percent. Stock Z has a beta of .85 and an expected return of 11.7 percent. If the risk-free rate is 5.10 percent and the market risk premium is 7.60 percent, are these stocks overvalued or undervalued? Stock Y Stock Z
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