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b. Suppose that the risk-free rate of return is 3.8% and the expected rate of return on the market is 12%. Asset X, Q, Y,

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b. Suppose that the risk-free rate of return is 3.8% and the expected rate of return on the market is 12%. Asset X, Q, Y, and Z have the following beta: $x = 0.8, BQ = -1.2, By = 2.3, and Bz = 1.8. From the historical data we know that the expected returns on the assets are rx=5.8%, rq = -3.5%, ry= 28%, and rz = 12%. Calculate the alpha of each asset and make your investment decisions. (10 marks)

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