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A one-factor APT model explains returns in the economy in this question. Suppose the returns to investments in mint-ice-cream production (my favourite ice cream flavour)
A one-factor APT model explains returns in the economy in this question. Suppose the returns to investments in mint-ice-cream production (my favourite ice cream flavour) explain returns in this economy. The risk-free rate is constant over these 3 years at 1% per year. You observe the following annual returns: What is the alpha of Pet Rock Manufacturing? Assume that the alpha, beta and the risk-free rate are constant over these three years and that there is no firm-specific return other than alpha. Please choose the answer that is closest to the correct answer. \begin{tabular}{l} 1% \\ \hline 1% \\ 2% \\ 3% \\ \hline 0% \end{tabular} A one-factor APT model explains returns in the economy in this question. Suppose the returns to investments in mint-ice-cream production (my favourite ice cream flavour) explain returns in this economy. The risk-free rate is constant over these 3 years at 1% per year. You observe the following annual returns: What is the alpha of Pet Rock Manufacturing? Assume that the alpha, beta and the risk-free rate are constant over these three years and that there is no firm-specific return other than alpha. Please choose the answer that is closest to the correct answer. \begin{tabular}{l} 1% \\ \hline 1% \\ 2% \\ 3% \\ \hline 0% \end{tabular}
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