If markets are in equilibrium, which of the following conditions will exist? a. Each stock's expected return should equal its realized return as seen by the marginal investor. b. Each stock's expected return should equal its required return as seen by the marginal investor. c. All stocks should have the same expected return as seen by the marginal investor. d. The expected and required returns on stocks and bonds should be equal. e. All stocks should have the same realized return during the coming year.

Equilibrium is a market exists when quantity demanded equals the quantity supplied. At equilibrium, demand equals supply. Above equilibrium there is a surplus and below equilibrium there is scarcity.

When there is equilibrium in the stock market, each stock's expected return should equal its realized return as seen by the marginal investor

If there is a surplus in the stock market, realized return would be greater than expected return

If there is a scarcity in the stock market, expected return would be greater than realized return