Question: When a security is underpriced, it means that it has a high return to risk ratio. Therefore, the investors should buy the security True False

  1. When a security is underpriced, it means that it has a high return to risk ratio. Therefore, the investors should buy the security

    True

    False

  2. If a conventional project A, has a IRR greater than the required rate of return then you expect the project to have a negative NPV.

    True

    False

  3. Suppose you are holding a portfolio of two stocks, a risk-free asset and a stock. Therefore, the correlation between the two assets in your portfolio should be zero

    True

    False

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