Question: Intro We know the following expected returns for stock A and the market portfolio, given different states of the economy: State (s) Probability E(TA,s) E(TM)

Intro We know the following expected returns for stock A and

Intro We know the following expected returns for stock A and the market portfolio, given different states of the economy: State (s) Probability E(TA,s) E(TM) Recession 0.1 -0.01 0.05 Normal 0.5 0.14 0.08 Expansion 0.4 0.22 0.12 The risk-free rate is 0.02. IB Attempt 1/5 for 10 pts. Part 1 Assuming the CAPM holds, what is the beta for stock A? K+ decimals Submit

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