Question: 3. Consider a single factor APT. Portfolio A has a beta of 1.0 and an expected return of 16%. Portfolio B has a beta of

3. Consider a single factor APT. Portfolio A has a beta

3. Consider a single factor APT. Portfolio A has a beta of 1.0 and an expected return of 16%. Portfolio B has a beta of 0.8 and an expected return of 12%. The risk-free rate of return is 6%. If you wanted to take advantage of an arbitrage opportunity, you should take a short position in which portfolio and a long position in portfolio (Please provide the detailed interpretation) (1) A; A (2) A: B (3) B; A (4) B; B (5) A; the riskless asset

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