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You are thinking about investing in the following stocks, but you don't want to pay too much. Stock Beta Expected Return Bath & Body Works
You are thinking about investing in the following stocks, but you don't want to pay too much.
Stock | Beta | Expected Return |
Bath & Body Works | .70 | 10% |
Amazon | .80 | 14% |
Verizon | 1.30 | 9% |
Home Depot | 1.10 | 13% |
The rate of return on Treasury bonds is 4% and the return on the S&P 500 is 11%. Which of these stocks appears to be overpriced?
A. Amazon
B. Bath & Body Works
C. All are overpriced
D. Verizon
E. Home Depot
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