A share is priced to return 10% but according to the CAPM its expected return is 7%. According to CAPM theory, we can expect the price of this share to:
A) fall.
B) rise.
C) uncertain.
D) stay the same.

Question

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The Answer of A share is priced to return 10% but according to the CAPM its expected return is 7%. According to CAPM theory, we can expect the price of this share to:
A) fall.
B) rise.
C) uncertain.
D) stay the same.

A Share Is Priced to Return 10% but According to the CAPM