Question: (C) Suppose that the relevant equilibrium model is CAPM with unlimited borrowing and lending at a riskless rate of interest. Compute the missing values (a*,

(C) Suppose that the relevant equilibrium model is CAPM with unlimited borrowing and lending at a riskless rate of interest. Compute the missing values (a*, b*,c*, d*, e*) in the following table, showing all intermediate steps. Standard Residual Asset Expected Return 0.08 Deviation Beta Variance 0 A 0.1 a* 0.12 B 2 b* 0.49 1 C 0 d* C* 0.05 D e* 0 0.36

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