Suppose You Have 5-Year Annual Data on the Excess Returns

question 23

Multiple Choice

Suppose you have 5-year annual data on the excess returns on a fund manager’s portfolio (“fund ABC”) and the excess returns on a market index (where is the return on fund ABC, is the risk-free rate and is the return on the market index) :

-Given the data in question 6, what is the estimated beta ( ) of Fund ABC?

• A) 3.1
• B) 2.1
• C) 1.1
• D) None of the above

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Definitions:

Increases

Refers to a process or action resulting in a greater amount, number, or degree of something.

Constant

A situation or value that does not change or vary, often used in the context of scientific experiments or mathematical equations.

REM Sleep

REM sleep, or Rapid Eye Movement sleep, is a phase of sleep characterized by fast eye movements, vivid dreams, and increased brain activity.

N1 Sleep

The initial stage of non-REM sleep characterized by light sleep, from which a person can be easily awakened.