The reward$-$to$-$risk ratio for Stock A is less than the reward$-$to$-$risk ratio of Stock B$.$ Stock A has a beta of $\mathrm{.}82$ and Stock B has a beta of $1\mathrm{.}29.$ This information implies that:

options:

$1.$ Stock A is less risky than Stock B and both stocks are fairly priced.

$2.$ Stock A is riskier than Stock B and both stocks are fairly priced.

$3.$ either Stock A is overpriced or Stock B is underpriced or both.

$4.$ either Stock A is underpriced or Stock B is overpriced or both.

$5.$ both Stock A and Stock B are correctly priced since Stock A is less risky than Stock B$.$