Two investment advisers are comparing performance. One averaged a 16% rate of return and the other a 13% rate of return. However, the beta of the first investor was 1.6, whereas that of the second investor was 1. a. Can you tell which investor was a better selector of individual stocks (aside from the issue of general movements in the market)?

1. First investor
2. Second investor
3. Cannot determine

b. If the T-bill rate was 8% and the market return during the period was 10%, which investor would be considered the superior stock selector?

1. Second investor
2. First investor
3. Cannot determine

c. What if the T-bill rate was 5% and the market return was 12%?

1. First investor
2. Second investor
3. Cannot determine