In a recent closely contested lawsuit, Apex sued Bpex for patent infringement. The jury came back today with its decision. The rate of return on Apex was r A = 3.1%. The rate of return on Bpex was...

In a recent closely contested lawsuit, Apex sued Bpex for patent infringement. The jury came

back today with its decision. The rate of return on Apex was r_A
= 3.1%. The rate of return on Bpex was only              r_B
= 2.5%. The market today responded to very encouraging news about the unemployment rate, and      r_M
= 3%. The historical relationship between returns on these stocks and the market portfolio has been estimated from index model regressions as:
Apex: r_A
= .2% + 1.4r_M

Bpex: r_B
= −.1% + .6r_M

On the basis of these data, which company do you think won the lawsuit?