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You are currently evaluating a potential stock purchase. As you are gathering information about the stock you notice a few things. First, you see that

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You are currently evaluating a potential stock purchase. As you are gathering information about the stock you notice a few things. First, you see that the expected rate of return on the market is 14%, and the risk free rate is 5%. The stock you are interested in has a beta of 19 , and is currently priced to yield a return on 15% (expected return). If this is true then, what must also be true? Select one: a. The stock is faifly priced b. The stock is overpriced c. The stock lies above the SML d. The stock lies on the SML e. The stock is underpriced

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