Moving to another question will save this response. estion 16 Suppose we estimate the index model by linear regression and obtain the following results: RA = 3% +0.7RM CARE is correct? a. Stock A has an alpha of 0.7 b. Stock A has a beta of 3% Betas of stock A and B cannot be found from the regression results. d. Stock A has a beta of 0.7 e. None of the above cholces is correct. 80 # $ 2 % 5 3 4 6 7. W E R Y S D F. G Close Window Question 16 of 30 3.333 points Save Answer ERA-3% +0,7RMA, Rg 1% + 1,2Reg. Om 10%, R A) -0.45, R2(B) = 0.7. Which of the following statements ONLY Di DD & 7 8 9 0 { [ Y H J K Moving to another question will save this response. estion 17 Suppose we estimate the index model by linear regression and obtain the following results: RA - 39 +0.7RM + e, Rg = is correct? FINA340 Exam 2 Formula Sheet.pdf a. Stock A has greater market risk than Stock B. b. Market movement explains a greater fraction of price movement of Stock 8 than that of Stock A. c. Stock A has the same market risk as Stock B. d. Based on the given information, it's impossible to know which stock has higher firm-specific risk. Stock B has higher alpha than Stock A because of its higher beta and higher R2 888 A # 3 2 4 5 6 7 Q W E R Y Close Window Question 17 of 30 3.333 points Save an wwing results: RA = 340.7RMA, Rg = 1% +1.2MB. OM=10%, R)-0.45, R2(B) = 0,7. Which of the following statements ck B than that of StockA as higher firm specific risk nigher R2 DD on 6 8 o 9 1 0 Y