OLG stock has a beta of 0.98 and an expected return of 10.52 percent. The risk-free rate of return is 3.02 percent, market rate of return is 10.47 percent. Which one of the following statements is true given this information? A. The expected return on OLG stock based on the capital asset pricing model is 10.13 percent. 8. The return on OLG stock will graph above the security market line. C. OLG stock is correctly priced. D. OLG stock is overpriced.

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