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Within the context of the capital asset pricing model ( CAPM ) assume Expected return on the market = 1 5 % . Risk -

Within the context of the capital asset pricing model (CAPM) assume
Expected return on the market =15%.
Risk-free rate =8%.
Expected rate of return on XYZ security =17%.
Beta of XYZ security 1.25.
Which one of the following is correct?
a.xYZ's alpha is 25%
b. XYZ's alpha is -25%
c.xYZ is fairly priced.
d. XYZ is overpriced.
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