schweser practice exam vol1 - #11

Can someone help explain question #11? In the answer, it has the following output: E® = a + 0 + 0 + 0 = 0.12, so a = 0.155. This is so confusing, shouldn’t a=0.12 according to this logic? or E®=0.155?

it’s said that the intercept of macroeconomic model can be deducted from some APT; using those APT numbers, it’s .155 and I think forecasts (0.12) can be conducted with some other models and it’s normal to be different from the outcome from APT.

Thanks, lafricana. Also for problem #18, the explanation is not clear, either. When she uses a small value of alpha0, why would it make the adjusted beta forcast further away from 1?

that’s an error by schweser. they’ve corrected it.