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Suppose that the index model for stocks A and B is estimatedfrom excess returns with the following results:RA = 5.00% + 1.30RM + eARB =

Suppose that the index model for stocks A and B is estimatedfrom excess returns with the following results:RA = 5.00% + 1.30RM + eARB = -2.00% + 1.60RM + eB?M = 20%; R-squareA = 0.20; R-squareB = 2 answers

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