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Given the Following Data for a Stock: Beta = 0

Question 21

Multiple Choice

Given the following data for a stock: beta = 0.9; risk-free rate = 4%; market rate of return
= 14%; and Expected rate of return on the stock = 13%. Then the stock is:


A) overpriced
B) under priced
C) correctly priced
D) cannot be determined

Correct Answer:

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