1. a. Please estimate and plot the SML that can be constructed using the data contained inSML_data.xls. The data file contains data on six individual stocks' excess returns for a period. Italso contains excess return data for a market index (SP500) for the same period. Does the estimated SML indicate statistically significant risk return trade-off relationship? Explain. Please present the related regression table.

b. What is the firm-specific risk exposure of AMR? Do the necessary estimation and make your conclusion. Please provide detailed explanation. Please present the related regression table.