Some observers of the hedge-fund industry have said that much of the apparent alpha produced by hedge funds is" just beta waiting to be discovered." 

PART A Provide an explanation of this statement. [10 MARKS]

PART B Does alpha necessarily reflect skills to identify mispriced assets? If you suspect that a given manager's estimated alpha doesn't reflect such skill, how could you confirm your suspicion? That is, what data would you want, and what empirical test would you run?