4. Howie, a security analyst, has used the concept of multiple regression to determine the sensitivity of a certain stock to various factors. He has found that the following factors are the most indicative of his stocks returns:

Factor	Factor Beta	Factor risk premium
Inflation	1.2	3%
unemployment	0.8	5%
Industrial production	0.7	6%

If the rate on 90-day T-bills is 3%,

a. what is the expected return for this stock?

b. What is the Jensen Alpha if the portfolio return is 12%