Question
Which one of the following stocks is correctly priced if the risk-free rate of return is 3.6 percent and the market risk premium is 8.3
Which one of the following stocks is correctly priced if the risk-free rate of return is 3.6 percent and the market risk premium is 8.3 percent?
| Stock | Beta | Expected Return | ||||
| A | .75 | 12.50 | % | |||
| B | 1.54 | 12.63 | ||||
| C | 1.20 | 13.56 | ||||
| D | 1.30 | 11.90 | ||||
| E | .90 | 8.65 | ||||
Multiple Choice
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Stock D
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Stock E
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Stock C
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Stock B
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Stock A
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Derivatives And Internal Models
Authors: Hans Peter Deutsch, Mark W. Beinker
5th Edition
3030229017, 9783030229016
