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9. Suppose that portfolio A is correctly priced according to a two-factor APT model. A's beta with factor #1 is 0.50 and its beta with

9. Suppose that portfolio A is correctly priced according to a two-factor APT model. A's beta with factor #1 is 0.50 and its beta with factor #2 is 1.25. The risk-free rate is 7%. If the risk premiums for factors #1 and #2 are 1.00% and 7.00%, respectively, then A's expected return is: a) 13.50%. 15.00% 16.25%. d) 23.00%. e) None of the above is correct

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