USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 70

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
R_it = return for stock i during period t
R_mt = return for the aggregate market during period t
-Refer to Exhibit 5.2. 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 percent
• B) 2.4 percent
• C) 2.0 percent
• D) 1.3 percent
• E) -1.5 percent