18. The risk-free rate of return is 3.9 percent and the market risk premium is...
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18. The risk-free rate of return is 3.9 percent and the market risk premium is 6.2 percent. A stock with a beta of 1.21 reports the actual retum of 10.5%. Based on CAPM, we can tell A this stock is underpriced B. this stock is Overpriced C. this stock is fairly priced D. no definite conclusion can be made regarding its price
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