(4) Consider the exact factor model Ri=Ri+j=1KbijIj,i=1,2,,N. a) Write down the general exact APT equation. (E) b) Write down the exact APT equation if there exists a risk-free asset with return RF. (E) c) Consider the following specific exact factor model: R1=0.06+0.8I1+1.4I2R2=0.05+1.2I1+1.1I2. What is the expected return R3 on an asset with factor loadings b31=0andb32=2 if there exists a risk-free asset with return RF=0.01 ? (C) (4) Consider the exact factor model Ri=Ri+j=1KbijIj,i=1,2,,N. a) Write down the general exact APT equation. (E) b) Write down the exact APT equation if there exists a risk-free asset with return RF. (E) c) Consider the following specific exact factor model: R1=0.06+0.8I1+1.4I2R2=0.05+1.2I1+1.1I2. What is the expected return R3 on an asset with factor loadings b31=0andb32=2 if there exists a risk-free asset with return RF=0.01 ? (C)