A Particular Asset Has a Beta of 1

question 12

Multiple Choice

A particular asset has a beta of 1.2 and an expected return of 10%.The expected return on the market portfolio is 13% and the risk-free is 5%.The stock is

• A) overpriced
• B) underpriced
• C) appropriately priced
• D) Cannot tell from the given information

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Definitions:

War-Torn Areas

are regions that have been severely affected by the consequences of armed conflict, impacting their social and economic fabric.

Conservation

The protection, preservation, management, or restoration of natural environments and the ecological communities that inhabit them to prevent depletion or degradation.

Land Covered

The extent or area over which land use practices, such as agriculture or urban development, are applied.

Forests

Large areas covered predominantly with trees and undergrowth, playing crucial roles in the Earth's ecosystem and climate regulation.