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Stock Y has a beta of 1.3 and an expected return of 18.5%. Stock Z has a beta of 0.7 and an expected return of

Stock Y has a beta of 1.3 and an expected return of 18.5%. Stock Z has a beta of 0.7 and an expected return of 12.1%.

If the risk-free rate is 8%, the market risk premium is 15.5%, Are these stocks correctly priced?

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