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The risk free rate is 2.3% and the market price of risk is 11.5%. A stock with a beta of 1.6 has an expected dividend
The risk free rate is 2.3% and the market price of risk is 11.5%. A stock with a beta of 1.6 has an expected dividend yield of 6% and an expected capital gain of 13%. This stock's alpha is equal to ______ and the stock is ________.
-1.7%; overpriced
1.7%; underpriced
-7.25%; underpriced
+7.25%; overpriced
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