Question: 10-4 Consider the two (excess return) Index-model regression results for stocks A and B. The risk-free rate over the perlod was 7%, and the market's

10-4

10-4 Consider the two (excess return) Index-model regression results for stocks A

Consider the two (excess return) Index-model regression results for stocks A and B. The risk-free rate over the perlod was 7%, and the market's average return was 16%. Performance is measured using an Index model regression on excess returns. a. Calculate the following statistics for each stock: (Round your answers to 4 declmal places.) b. Which stock is the best choice under the following circumstances

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