Two stocks with the same expected cash flow one period

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Two stocks with the same expected cash flow one period from today (after which both stocks will be worthless) of $100 have different levels of systematic risk. Stock A has 1.2 units of systematic risk and is priced at $85 per share while stock B has 1.5 units of systematic risk and is priced at $87 per share. Briefly describe whether the situation described is a reasonable situation, and why or why not.

Reference no: EM131614064

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Two stocks with the same expected cash flow one period : Two stocks with the same expected cash flow one period from today (after which both stocks will be worthless) of $100 have different levels of systematic risk.

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