4. Long Question 4 (10 points) Consider an economy with a risk-free rate of 10%...

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4. Long Question 4 (10 points) Consider an economy with a risk-free rate of 10% and two independent economic factors F1 and F2. The following are well diversified portfolios: Assuming the APT model with the factors F1 and F2 is a good model for this economy, compute the risk premia for the two factors and write the expected return-beta relationship in this economy

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