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You have been comparing two investment advisers' performance in the past year. Adviser A averaged a 20% return with a portfolio beta of 1.5, and

You have been comparing two investment advisers' performance in the past year. Adviser A averaged a 20% return with a portfolio beta of 1.5, and adviser B averaged a 15% return with a portfolio beta of 1.2. If the T-bill rate was 5% and the market risk premium during the period was 13%, which advisor should you choose?
A. Both advisors were bad because their alphas were both negative.
B. Both advisors were good because their alphas were both positive.
C. Advisor A was better because he generated a larger alpha.
D. Advisor B was better because she generated a larger alpha.

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