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Which one of the following stocks is correctly priced if the risk-free rate of return is 3.4 percent and the market risk premium is 7.9
Which one of the following stocks is correctly priced if the risk-free rate of return is 3.4 percent and the market risk premium is 7.9 percent?
Stock | Beta | Expected Return | ||||
A | .85 | 8.50 | % | |||
B | 1.50 | 15.25 | ||||
C | 1.31 | 11.25 | ||||
D | 1.23 | 11.77 | ||||
E | .95 | 8.65 | ||||
Multiple Choice
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Stock B
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Stock A
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Stock E
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Stock D
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Stock C
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