Question: In a recent closely contested lawsuit, Apex sued Bpex for patent infringement. The jury came back today with its decision. The rate of return on

In a recent closely contested lawsuit, Apex sued Bpex for patent infringement. The jury came back today with its decision. The rate of return on Apex was ra= 3.9%. The rate of return on Bpex was only 1g = 3.5%. The market today responded to very encouraging news about the unemployment rate, and I = 3.6%. The historical relationship between returns on these stocks and the market portfolio has been estimated from index model regressions as: Apex: A - 0.3% + 1.17M Bpex: 8 - -0.1% + 0.7rM a. What is the predicted returns for Apex & Bpex? (Do not round intermediate calculations. Round your answers to 1 decimal place.) Predicted Returns % Apex Bpex % b. Which company do you think won the lawsuit? O Apex Bpex

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