Question: The expected return and betas for three stocks are given below: EXPECTED RETURN (%) BETA 1.4 1.2 1.7 Stock A B 9.5 9 12

The expected return and betas for three stocks are given below: EXPECTED

The expected return and betas for three stocks are given below: EXPECTED RETURN (%) BETA 1.4 1.2 1.7 Stock A B 9.5 9 12 Market returns, R ,is 8% and risk-free rate is 3%. Which of the three stocks is undervalued according to the CAPM? m'

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