You are analyzing a common stock with a beta of 0.8. The risk-free rate of interest is 3 percent and the market risk premium is 10 percent. If the stock's return based on its market price is 11 percent, is the stock over, under or correctly valued

The stock is correctly valued

Step-by-step explanation:

The formula for SML return can be given as:

SML return = Risk free rate + (beta*market risk premium )

Risk free rate = 3%  = 0.03

Beta =0.8

market risk premium =10%  = 0.1

SML return = 0.03+(0.8*0.1) = = 0.11 = 0.11 * 100 = 11%

Stock return based on market price = 11%

Since SML return = Stock return based on market price = 11% , the stock is correctly valued

< coa = 150 ( given)

as ba and bc are tangents

so oc and oa is perpendicular to cb and ab respectively because in circle normal passes through centre

so in quadrilateral oabc

< coa + < oab + < ocb + < abc = 360

150 +90+90 + < abc = 360

330 + < abc = 360

< abc = 360 -330 = 30

so < abc = 30

⭐dhruv⭐

c

step-by-step explanation: