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Flash forward 5 years to your successful career as a stock analyst. Youve done a thorough valuation of LIFE Inc.s stock, and believe the stock

Flash forward 5 years to your successful career as a stock analyst. Youve done a thorough valuation of LIFE Inc.s stock, and believe the stock has an expected return of 16%, given your extensive analysis. Meanwhile the stock has a beta of 0.85. The expected market return and risk-free return are 16.4% and 4.1%, respectively. What is LIFEs alpha?

a. 1.45%

b. 2.06%

c. -1.45%

d. -2.06%

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