The Risk-Free Rate Is 3

question 80

Multiple Choice

The risk-free rate is 3.0 percent and the expected return on the market is 9 percent.Stock A has a beta of 1.20.For a given year,Stock A returned 12.5 percent while the market returned 9.75 percent.The systematic portion of Stock A's unexpected return was _____ percent and the unsystematic portion was _____ percent.

• A)0.80; 1.30
• B)0.90; 1.40
• C)1.11; 2.30
• D)1.40; 0.90
• E)4.62; 1.41

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Definitions:

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