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Consider the following information: Expected Portfolio Return Beta Risk-free 10% 0 Market 18 A 16 1.0 8.9 a. Calculate the expected return of portfolio A

Consider the following information: Expected Portfolio Return Beta Risk-free 10% 0 Market 18 A 16 1.0 8.9 a. Calculate the expected return of portfolio A with a beta of 0.9. Expected return b. What is the alpha of portfolio A. (Round your answer to 2 decimal places. Negative value should be indicated by a minus sign.) Alpha % c. If the simple CAPM is valid, is the above situation possible

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