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Two investment advisers are comparing performance. One averaged a 20% rate of return and the other a 19% rate of return. However, the beta of
Two investment advisers are comparing performance. One averaged a 20% rate of return and the other a 19% rate of return. However, the beta of the first investor was 1.1, whereas that of the second investor was 1. a. Can you tell which investor was a better selector of individual stocks (aside from the issue of general movements in the market)? First investor Second investor O Cannot determine b. If the T-bill rate was 5% and the market return during the period was 10%, which investor would be considered the superior stock selector? Cannot determine First investor Second investor
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