im not sure what you mean "in opposite layout." it states the question clearly. ...
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im not sure what you mean "in opposite layout." it states the question clearly.
Assume that security returns are generated by the single-index model, Ri" 4 + ORM where R is the excess return for security and Ry is the market's excess return. The risk-free rate is 2%. Suppose also that there are three securities A, B, and C characterized by the following data: Security & E(R) 0(4) A 0.7 77 283 B 0. 996 1.1 11 15 a. If On-16%, calculate the variance of returns of securities A, B, and C. Variance Security A Security B Security C b. Now assume that there are an infinite number of assets with return characteristics identical to those of A, B, and respectively. What will be the mean and variance of excess returns for securities A, B and C? (Enter the variance answers as a percent square and mean as a percentage. Do not round intermediate calculations. Round your answers to the nearest whole number.) Mean Variance Security A Security B Security C
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