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3. The expected return on the market portfolio is 15%. The risk-free rate is 8%. The return on SDA Corp. common stock tumed to be

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3. The expected return on the market portfolio is 15%. The risk-free rate is 8%. The return on SDA Corp. common stock tumed to be 16%. The beta of SDA Corp.common stock is 1.25. Within the context of the capital asset pricing model, A. SDA Corp. stock is underpriced B. SDA Corp. stock is fairly priced C. SDA Corp. stock's alpha is -0.75% D. SDA Corp. stock alpha is 0.75% 4. What is the Jensen alpha measure for the portfolio based on the following information: Rovie = 16% St. Dev. pellolio=22% Betawi = 1.32 T-Bills Rate = 4% Ruusk = 12% St.Dext = 31% A 0 B. 1.4% C. 12% D. -4%

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