Question: Consider the two (excess return) index model regression results for A and B : RA = 1.2% + 1.2 RM Residual standard deviation = 10.3%

Consider the two (excess return) index model regression results for A and B: RA = 1.2% + 1.2RM

Residual standard deviation = 10.3%

RB = 2.1% + 0.8RM

Residual standard deviation = 9.1%

If rf were constant at 6.5% and the regression had been run using total rather than excess returns, what would have been the regression intercept for stock B?

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