You estimate that a share of Axios Incorporated will rise from $57 to $61 per share over the next year. You know that the annual return on the S&P/ASX 200 has been 9.25% and the 90-day T-bill rate has been yielding 3.75% per year over the past 10 years. If the beta for Axios is 0.85, will you purchase the share?

Select one:

A.

yes, because it is overvalued.

B.

yes, because it is undervalued.

C.

no, because it is overvalued.

D.

no, because it is undervalued.