Question
The market risk premium is 7% and the risk-free rate is 2%. A security with a beta of 2 and an expected return of 16%
The market risk premium is 7% and the risk-free rate is 2%. A security with a beta of 2 and an expected return of 16% is ..........
a) Incorrectly valued
b) underpriced
c) None of them
d) Over priced
e) Fairly Priced
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Financial Markets and Institutions
Authors: Frederic S. Mishkin, Stanley G. Eakins
8th edition
013342362X, 978-0133423624
