If the valuation of a stock is $20 and it currently sells for $25, then
1) the stock is undervalued
2) the stock is overvalued
3) the investor should establish a short position
4) the investor should establish a long position
A) 1 and 3
B) 1 and 4
C) 2 and 3
D) 2 and 4
Correct Answer:
Verified
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