Question: Consider the single-factor APT. Stocks A and B have expected returns of 15% and 18%, respectively. The risk-free rate of return is 6%. Stock B

Consider the single-factor APT. Stocks A and B have expected returns of 15% and 18%, respectively. The risk-free rate of return is 6%. Stock B has a beta of 1.0. If arbitrage opportunities are ruled out, stock A has a beta of

rev: 03_31_2016_QC_CS-46831

Select one:

a. 0.67.

b. 1.00.

c. 1.30.

d. 1.69.

e. 0.75.

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