The risk-free rate is 7%. The expected market rate of return is 15%. If you expect a stock with a beta of 1.3 to offer a rate of return of 12%, you should
A. buy the stock because it is underpriced.
B. sell the stock short because it is underpriced.
C. buy the stock because it is overpriced.
D. sell short the stock because it is overpriced.
E. None of the options, as the stock is fairly priced.
Answer: D
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An injured buyer can recover consequential damages when a seller breaches a contract if the:
A. expenses incurred during storage of goods do not conform to those called for in the contract. B. buyer purchases goods that have a higher market price than the contract price in the breached contract. C. buyer can show that the damage could not have been prevented by obtaining substitute goods. D. goods are not consumer products.
Michael & Co. expects overhead costs of $60,000 per month and direct production costs of $24 per unit. The estimated production activity for the current accounting period is as follows: 1st Quarter2nd Quarter3rd Quarter4th QuarterUnits produced11,5009,0008,25011,250 The predetermined overhead rate based on units produced is: (rounded to the nearest penny.)
A. $1.50 per unit. B. $2.67 per unit. C. $42.00 per unit. D. $18.00 per unit.
Terrorists chose to attack the World Trade Center on September 11, 2001 because they understood the power of the spoken word
Indicate whether the statement is true or false
What is a full set of constraints for this problem if there are 30 MBA students enrolled this semester?
The $75 per credit hour course fee tacked on to all the MBA classes has generated a windfall of $56,250 in its first semester. "Now we just need to make sure we spend it all," the Assistant Dean cackled. She charged the Graduate Curriculum Committee with generating a shopping list before their next meeting. Four months later, the chairman of the committee distributed the following. As the professor for the quantitative modeling course, he tended to think in terms of decision variables, so he added the left-most column for ease of use. Decision Variable Item Cost Note A iPads for everybody $750/unit Must get a cover if these are purchased B iPad covers with MBA logo $25/unit Not needed unless we buy iPads C Speaker series $15,000 Can't afford both this and the iPads D Subscriptions to the Wall Street Journal $10/unit Don't need if we have the electronic version E Subscriptions to the electronic version of the Wall Street Journal $5/unit Worthless without the iPads