The Index Model for Stock a Has Been Estimated with the Following

question 32

Multiple Choice

The index model for stock A has been estimated with the following result: R_A = 0.01 + 0.94R_M + e_A
If $\sigma$ _M = 0.30 andR²_A = 0.28, the standard deviation of return of stock A is

• A)0.2025.
• B)0.2500.
• C)0.4500.
• D)0.5329.

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