Exhibit 64
Use the Information Below for the Following Problem(S)

question 86

Multiple Choice

Exhibit 6.4
Use the Information Below for the Following Problem(S)
$$\begin{array} { c c c c c } \text { stack } & \text { Fit } & R \text { mit } & \text { a } _ { \text {i } } & \text { Eeta } \\\hline \text { A } & 10.3 & 12 & 0 & 0.6 \\3 & 94 & 90 & 0 & 1 .2\end{array}$$
R?t = return for stock i during period t
Rmt = return for the aggregate market during period t
-Refer to Exhibit 6.4.What is the abnormal rate of return for Stock A during period t using only the aggregate market return (ignore differential systematic risk) ?

• A) 3.34
• B) 1.75
• C) -1.75
• D) -3.70
• E) -1.70

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Definitions:

Fixed Proportions

A production condition where inputs must be combined in strict, unchanging ratios to produce output.

Substitution Effect

The change in the quantity demanded of a good resulting from a change in its price, making it more or less expensive relative to other goods.

Output Effect

The change in total output resulting from a change in the quantity of an input, other factors being held constant.

Substitute Resource

An alternative resource that can be used in place of another to produce similar goods or services.