Question: Using CAPM, you find the required return on a stock is 5%. Based on your own estimates, you think the expected return on the stock

Using CAPM, you find the required return on a stock is 5%. Based on your own estimates, you think the expected return on the stock will be 4%. How do you interpret this?

A. This is an attractive stock.

B. This is NOT an attractive stock.

C. The stock seems fairly priced.

D. There is not enough information to determine if the stock is or is not an attractive stock.

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