Question: Consider the two (excess return) index model regression results for A and B: RA = 0.08 + 1.28RM R square= 0.576 Residual standard deviation =

Consider the two (excess return) index model regression results for A and B:

RA = 0.08 + 1.28RM

R square= 0.576

Residual standard deviation = 10.3%

RB = -0.02 + 0.72RM

R square= 0.436

Residual standard deviation = 9.1%

If rf were constant at 0.04 and the regression had been run using total rather than excess returns, what would have been the regression intercept for stock A?

Round your answer to 4 decimal places. For example, if your answer is 3.205%, then please write down 0.0321.

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