Suppose stock returns can be explained by the following three-factor model: Ri 3D RF + B1F1 + B2F2 - ???? Assume there is no firm-specific risk. The information for each stock is presented here: B1 ??...

Suppose stock returns can be explained by the following three-factor model: Ri 3D RF + B1F1 + B2F2 - ???? Assume there is no firm-specific risk. The information for each stock is presented here: B1 ?? B2 Stock A 1.09 .41 .04 Stock B .71 1.26 -.16 -.08 Stock C .62 1.15 The risk premiums for the factors are 5.7 percent, 5.8