Question: From the following information given, calculate the expected return during the Arbitrage Pricing Theory: Risk free rate is 3.5% Gold prices: beta of 0.4 and

From the following information given, calculate the expected return during the Arbitrage Pricing Theory:

Risk free rate is 3.5%

Gold prices: beta of 0.4 and risk premium of 4%

GDP growth: beta of 0.8 and risk premium of 3%

Inflation: beta of 0.9 and risk premium of 2%

Russel Index: beta of 1.2 and risk premium of 8%

a.

21.7%

b.

20.5%

c.

14%

d.

3.5%

e.

none of answers is correct

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