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1. The risk-free rate, the average returns, standard standard deviations for three funds and the S&P 500 deviations, betas, and residual Std. Dev 30 35

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1. The risk-free rate, the average returns, standard standard deviations for three funds and the S&P 500 deviations, betas, and residual Std. Dev 30 35 25 20 0 Fund Beta 1.3 Residual Std. Dev 18 25 20 15 1.5 2.5 3.0 1.2 1.0 0 S&P 500 Risk-free 1) Figure out a fund with the highest Jensen's alpha. (20points) 2) Figure out the information ratio for Fund C.(15points)

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