Question: Problem 11-20 In a recent closely contested lawsuit, Apex sued Bpex for patent Infringement. The jury came back today with its decision. The rate of

Problem 11-20 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 3.2%. The rate of return on Bpex was only r, 2.6%. The market today responded to very encouraging news about the unemployment rate, and ry -3%. The historical relationship between returns on these stocks and the market portfolio has been estimated from Index model regressions as: Apexi FA-0.20 + 1.51 Bpex -0.11 0.77 a. What is the predicted returns for Apex & Bpex? (Do not round Intermediate calculations. Round your answers to 1 decimal place.) Predicted Returns b. Which company do you think won the lawsuit? Apex Bpex

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