The risk-free rate is 3.7 percent and the expected return on the market is 12.3 percent. Stock A has a beta of 1.1 and an expected return of 13.1 percent. Stock B has a beta of .86 and an expected return of 11.4 percent. Are these stocks correctly priced? Why or why not?

No, Stock A is underpriced but Stock B is correctly priced.No, Stock A is underpriced and Stock B is overpriced.No, Stock A is overpriced but Stock B is correctly priced.No, both stocks are overpriced.No, Stock A is overpriced and Stock B is underpriced.