Would you purchase the share

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Question - Angel is a broker, she has advised you that she believes that the share price of Kgosi Limited is going to rise from R20 to R23 per share over the next year. You know that the annual return on the All Share Indexes (ALSI) has been 11.25% and the 90-day treasury rate is 4.50% per annum. If the beta of Kgosi Limited is 0.95, would you purchase the share?

A. No, because it is overvalued.

B. Yes, because it is overvalued.

C. Yes, because it is undervalued.

D. No, because it is undervalued.

Reference no: EM133071109

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