Business, 01.07.2020 16:01 BeautyxQueen

Stock A has a beta of .68 and an expected return of 8.1 percent. Stock B has a 1.42 beta and expected return of 13.9 percent. Stock C has a 1.23 beta and an expected return of 12.4 percent. Stock D has a 1.31 beta and an expected return of 12.6 percent. Stock E has a .94 beta and an expected return of 9.8 percent. Which one of these stocks is correctly priced if the risk-free rate of return is 2.5 percent and the market risk premium is 8 percent? A. Stock D
B. Stock E
C. Stock A
D. Stock C
E. Stock B

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Stock A has a beta of .68 and an expected return of 8.1 percent. Stock B has a 1.42 beta and expecte...

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