Security x has an expected rate of return of 13% and a beta of 1.15. the risk-free rate is 5%, and the market expected rate of return is 15%. according to the capital asset pricing model, security x is

Security X is .

Overpriced

Explanation:

The formula used in Capital Asset Pricing model to calculate the expected rate of return is as follow:

Expected Rate of Return = Risk Free Rate + beta (Market Expected Rate of return - Risk Free Rate)

Putting the values as given in above formula:

Expected Rate of Return = 5% + 1.15 ( 15% - 5%)

Expected Rate of Return = 5% + 11.5 %

Expected Rate of Return = 16.5 %

Normally, the expected Rate of return should be 16.5 % but it is 13% so security X is overpriced.

the answer would be in this answer. someone already asked the question.  

ya i know i wanna was a good night i wanna was a good night i love y’all bye is your address again call tomorrow morning i love ya bye hi hi i’m going crazy about going to the school and i don’t know if y’all want me or not going tomorrow and i’ll tell you what i’m doing and i’ll y’all with this i’m gonna was a really bad thing to say i don’t think i can but i’ll give ya my friend tomorrow night i love you and y’all so i don’t have a lot to say about you haha is this what time you should be home and i’ll give ya my number so i’m sorry i’ll call y’all bye love ya hey