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 5.1. What is the abnormal rate of return for Stock E during period t using only the aggregate market return (ignore differential systematic risk)?
A) 4.0 percent
B) 2.0 percent
C) 1.2 percent
D) -1.05 percent
E) -8.5 percent

Question

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 5.1. What is the abnormal rate of return for Stock E during period t using only the aggregate market return (ignore differential systematic risk)?
A) 4.0 percent 
B) 2.0 percent 
C) 1.2 percent 
D) -1.05 percent 
E) -8.5 percent

Quizplus · Accepted Answer

The Answer of 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 5.1. What is the abnormal rate of return for Stock E during period t using only the aggregate market return (ignore differential systematic risk)?
A) 4.0 percent 
B) 2.0 percent 
C) 1.2 percent 
D) -1.05 percent 
E) -8.5 percent