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You are attempting to predict the return on Dog Heavy Equipment.You have gathered the following data on the firm’s returns,relevant Treasury rates (for a risk-free rate), and the S&P1500 (which you plan to use as a market portfolio):YearDogTreasuryS & P 500112%2%14%27%2%8%314%1%9%48%1%12%54%1%7%612%0%9%79%0%10%81%1%12%9-10%1%15%1025%2%11%(i) Assume you believe that CAPM is the correct pricing model.Estimate the abnor- mal return on this stock and its beta. Shouldyou invest in this security?(ii) Do Dog’s returns provide evidence for or against a weakform efficient market?
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