The stock of Arbor Pet Trees (APT) is priced based on the given systematic risk factors....
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The stock of Arbor Pet Trees (APT) is priced based on the given systematic risk factors. Estimated sensitivities to these risk factors are given by the betas of the regression RAPT - Rrf = Bcredit Rcredit + value Rvalue + a + ε Factor Risk Premium Beta Credit Risk 5.6% 1.2 Valuation Risk 4.6% 0.5 Risk-free rate 2.6% What is the expected return on the stock of Arbor Pet Trees if the stock is fairly valued? The stock of Arbor Pet Trees (APT) is priced based on the given systematic risk factors. Estimated sensitivities to these risk factors are given by the betas of the regression RAPT - Rrf = Bcredit Rcredit + Bvalue Rvalue + a + ε Factor Credit Risk 5.2% Valuation Risk 3% Risk-free rate 2.8% If the actual return is 9.1%, what is the value of alpha? Risk Premium Beta 0.6 0.6 The stock of Arbor Pet Trees (APT) is priced based on the given systematic risk factors. Estimated sensitivities to these risk factors are given by the betas of the regression RAPT - Rrf = Bcredit Rcredit + value Rvalue + a + ε Factor Risk Premium Beta Credit Risk 5.6% 1.2 Valuation Risk 4.6% 0.5 Risk-free rate 2.6% What is the expected return on the stock of Arbor Pet Trees if the stock is fairly valued? The stock of Arbor Pet Trees (APT) is priced based on the given systematic risk factors. Estimated sensitivities to these risk factors are given by the betas of the regression RAPT - Rrf = Bcredit Rcredit + Bvalue Rvalue + a + ε Factor Credit Risk 5.2% Valuation Risk 3% Risk-free rate 2.8% If the actual return is 9.1%, what is the value of alpha? Risk Premium Beta 0.6 0.6
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