Exhibit 62
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 13

Multiple Choice

Exhibit 6.2
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) $$\begin{array} { c c c c c } \text { Stock } & \mathbf { R } _ { \text {it } } & \mathbf { R } _ { \text {mt } } & \mathbf { a } _ { \mathbf { i } } & \text { Beta } \\\hline \mathrm { ABC } & 11.5 & 13.0 & 0 & 0.7 \\\mathrm { XYZ } & 9.0 & 7.0 & 0 & 1.1\end{array}$$ R_it = return for stock i during period t
R_mt = return for the aggregate market during period t
-Refer to Exhibit 6.2. What is the abnormal rate of return for Stock XYZ during period t using only the aggregate market return (ignore differential systematic risk) ?

• A)-3.2%
• B)2.4%
• C)2.0%
• D)1.3%
• E)-1.5%

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Definitions:

Prepaid Pension Asset

An asset on the balance sheet that occurs when a company pays more into a pension plan than the current cost recognized for the benefits related to the period.

Pension Expense

The cost to a company for maintaining a defined benefit pension plan, including service cost, interest cost, expected return on plan assets, and any amortization of past service costs.

Pension Funding

The process of accumulating financial resources to cover obligations for pension plans, ensuring funds are available for retirement benefits.

Accumulated Benefit Obligation

The actuarial present value of all future pension benefits earned to date, based on current salary levels, without assuming future salary increases.