Using the Index Model,the Alpha of a Stock Is 3

question 65

Multiple Choice

Using the index model,the alpha of a stock is 3.0%,the beta if 1.1 and the market return is 10%.What is the residual given an actual return of 15%?

• A) 0.0%
• B) 1.0%
• C) 2.0%
• D) 3.0%

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