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QUESTION 13 The returns for stock A and market portfolio are as follows: Year Stock A Return 2006 2007 2008 11% 10% 3% Market portfolio

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QUESTION 13 The returns for stock A and market portfolio are as follows: Year Stock A Return 2006 2007 2008 11% 10% 3% Market portfolio return 9% 2% 1% Market risk premium is 5% and risk-free rate is 2%. a. (6 MARKS) What are the beta of your asset A? b. (5 MARKS) What is your stock A's Jensen's alpha? Is stock A under- or over-valued? c. (3 MARKS) What is the Sharpe ratio of the stock A? d. (2 MARKS) What is the Treynor measure of performance evaluation

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