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Q5: Q6: 5) Suppose that the risk-free rate...

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Finance

Q5: image
Q6:
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5) Suppose that the risk-free rate and the expected market rate of retum are 3% and 13%, respectively. According actual expected retum equals to 15%, what is the value of Alpha? What is the action that should be taken and why? 06) When can investors treat beta as a relevant risk measure and when can they treat beta as only a systematic risk measure? Explain the two cases clearly and carefully (Explain using a graph and make sure you label the axes) (20 points)

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