Question: You are given following information on beta and expected return for each stock: Stock A: beta=0.98, expected return =0.167. Stock B: beta =1.12, expected return

You are given following information on beta and expected return for each stock: Stock A: beta=0.98, expected return =0.167. Stock B: beta =1.12, expected return = 0.092. Stock C : beta =1.56,expected return =0.181. Stock D:beta 1.02,expected return 0.1862 stock E: beta = 1.14, expected return = 0.109. If the risk free rate of return is 4.2 percent and the market risk premium is 8.9 percent, which One Of These stocks is correctly priced according to CAPM? A) B B) A C) D D) C E) E

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