Question: Problem 8-12 Suppose that the index model for stocks A and B is estimated from excess returns with the following results: RA = 2.6% +

Problem 8-12 Suppose that the index model for stocks A and B is estimated from excess returns with the following results: RA = 2.6% + 0.90RM + eA RB = -2.0% + 1.20RM + eB M = 26%; R-squareA = 0.21; R-squareB = 0.12 What is the covariance between each stock and the market index? (Calculate using numbers in decimal form, not percentages. Do not round your intermediate calculations. Round your answers to 3 decimal places.) rev: 09_15_2017_QC_CS-100395, 02_22_2020_QC_CS-201669

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