Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
According to the Bloomberg Network (a Financial TV channel), the current return on the U.S T-bill is 4.0% and the market risk premium is 8.5%. Given this news, in the table below, the only stock that is correctly priced is:
See attached table
a. Stock E
b. Stock C
c. Stock B
d. Stock A
e. Stock D
Transcribed Image Text:Stock
Beta
Expected Return
A
• 79
12.30%
B
1.56
17.26
C
1.37
11.34
D
1.35
16.68
E
.95
8.65
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