Stock A's beta is 1.5 and Stock B's beta is 0.5. Which of the following statements must be true, assuming the CAPM is correct. a. When held in isolation, Stock A has more risk than Stock B. b. Stock B would be a more desirable addition to a portfolio than A. c. In equilibrium, the expected return on Stock B will be greater than that on Stock A. d. In equilibrium, the expected return on Stock A will be greater than that on B. e. Stock A would be a more desirable addition to a portfolio then Stock B.
