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Stock b has a beta of 86 and an expected return of 114

The risk-free rate is 3.7 percent and the expected return on the market is 12.3 percent. Stock A has a beta of 1.1 and an expected return of 13.1 percent. Stock B has a beta of .86 and an expected return of 11.4 percent. Are these stocks correctly priced? Why or why not?

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Corporate Finance: Stock b has a beta of 86 and an expected return of 114

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