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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Definitions:

Candy Bar

A confectionery item that is typically made from chocolate or a sugar-based mix, often with other ingredients like nuts or caramel.

Checkout Line

The queue or line that shoppers wait in to pay for their purchases at a store.

Problem Recognition

The stage of the buying process in which consumers recognize a gap between their current situation and a desired end-state.

Buying Process

The series of steps a consumer undergoes, from recognizing a need to purchasing a product or service.