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Suppose that the index model for stocks A and B is estimated from excess returns with the following results: RA = 3.8% + 1.25RM +
Suppose that the index model for stocks A and B is estimated from excess returns with the following results: RA = 3.8% + 1.25RM + eA RB = -1.88 + 1.6RM + eB OM = 18%; R-square A = 0.24; R-squares = 0.18 What is the standard deviation of each stock? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Standard Deviation Stock A % Stock B %
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