Question
If the T-bill rate is 6% and the market return is equally likely to be 8% and 20%, what is the return on Stock A
If the T-bill rate is 6% and the market return is equally likely to be 8% and 20%, what is the return on Stock A based on CAPM and what is the alpha of stock A?
Question options:
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| 26% and alpha is -5% |
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| 26% and alpha is 5% |
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| 20% and alpha is -2% |
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| 18% and alpha is -5% |
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield.
9th Canadian Edition, Volume 2
470964731, 978-0470964736, 978-0470161012
