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You invest in a mutual fund that earned 13.0% during the most recent year. The overall...

You invest in a mutual fund that earned 13.0% during the most recent year. The overall market earned 9.0% during that same period of time. Assuming the mutual fund has a beta of 1.80 and that the risk free rate is 2.0%, did the mutual fund earn positive alpha?

a. No, the mutual fund earned a negative alpha of 1.6%

b. Yes, the mutual fund earned a positive alpha of 4.0%

c. Yes, the mutual fund earned a positive alpha of 2.2%

d. No, the mutual fund earned a negative alpha of 2.8%

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