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Suppose the return on stock ABC was 14%. If CAPM is correct and if Risk free rate=3%, Return on market = 10% and ABC's Beta=1.45,

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Suppose the return on stock ABC was 14%. If CAPM is correct and if Risk free rate=3%, Return on market = 10% and ABC's Beta=1.45, the stock was: Overpriced (too high) Underpriced (too low) Properly priced Subject to uncompensated risk Not enough information to

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