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Consider the following two stocks A (left plot) and B (right plot) Which stock has higher alpha? Justify your answer. Consider the following stocks D,

Consider the following two stocks A (left plot) and B (right plot)

Which stock has higher alpha? Justify your answer.

Consider the following stocks D, E, and F which have the following properties: Assuming that the CAPM holds.

What is the risk-free rate? Show your calculations. What is the expected return on the market? Show your calculations. What is expected return on Stock F? Show your calculations.

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