Question: Consider a three-factor APT model with non-self-financing factors. The table below provides the expected return for each of the factors as well as the beta

Consider a three-factor APT model with non-self-financing factors. The table below

Consider a three-factor APT model with non-self-financing factors. The table below provides the expected return for each of the factors as well as the beta of Stock A with each of A the factors. According to this model, the expected return for Stock A is 12.7%. Calculate the risk-free rate. Factor Expected Beta for A Return F1 6.5% 0.38 F2 10.4% 1.27 F3 8.8% -0.24 O 1.77% 1.61% O 1.44% O 1.94% 2.11%

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