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Stock Y has a beta of .9 and an expected return of 12.6 percent. Stock Z has a beta of .6 and an expected return of 8.9 percent. If the risk-free rate is 5.7 percent and the market risk premium is 6.7 percent, the reward-to-risk ratios for stocks Y and Z are __________and ________percent, respectively. Since the SML reward-to-risk is ________percent, Stock Y is (undervalued or overvalued) and Stock Z is (undervalued or overvalued).

(Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Financial Management, Finance

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