Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Analysis of 60 monthly rates of return on United Futon common stock indicates a beta of 1.45 and an alpha of 0.2% per month. A

Analysis of 60 monthly rates of return on United Futon common stock indicates a beta of 1.45 and an alpha of 0.2% per month. A month later, the market is up by 5%, and United Futon is up by 6%. What is Futons abnormal rate of return? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Handbook Of Digital Currency Bitcoin Innovation Financial Instruments And Big Data

Authors: David Lee Kuo Chuen

1st Edition

0128021179, 978-0128021170

More Books

Students also viewed these Finance questions

Question

Is it clear what happens if an employee violates the policy?

Answered: 1 week ago