After calculating its actual historical returns you found


Write eveything in details with formulas not just the answe)

a) Assume the risk-free rate is 8% and the expected rate of return on the market is 18%. Stock ABC has an expected return of 6% predicted by CAPM. What is its beta?

b) After calculating it’s actual historical returns, you found the average return of ABC to be 10%. What is its alpha?

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Financial Management: After calculating its actual historical returns you found
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