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Recently You Have Received a Tip That the Stock of Bubbly

question 109

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Recently you have received a tip that the stock of Bubbly Incorporated is going to rise from $57 to $61 per share over the next year.You know that the annual return on the S&P 500 has been 9.25% and the 90-day T-bill rate has been yielding 3.75% per year over the past 10 years.If beta for Bubbly is 0.85,will you purchase the stock?

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