Problem $7-18($Algo$)$

Consider the following information:

Required:

a$.$ Calculate the expected return of portfolio A with a beta of $0\mathrm{.}9.($Round your answer to $2$ decimal places.$)$

Expected return

$\%$

b$.$ What is the alpha of portfolio $A.($Negative value should be indicated by a minus sign. Round your answer to $2$ decimal places.$)$

Alpha

$\%$

c$.$ If the simple CAPM is valid, is the above situation possible?

Yes

No