(1)Portfolio A has a covariance with Portfolio B of .09 and a covariance with the market of .06 while the standard deviation of the market is 20%. What is the expected return on Portfolio A if the risk free rate is .04 (4%) and the expected return on the market is 12%?

(2)The market price of a bond is $1129 (Face Value = 1000). It has 14 years to maturity and pays an annual coupon of $100 in semi-annual installments. What is the effective annual cost of debenture capitalbefore tax (kd)?

(3)Polycorp has a debt equity ratio of 0.44.What is the correct debt ratio D/V that should be used in the WACC formula?

WACC = ke x E/V+ kd x (1-t) x D/V

(4)The next dividend for ABC Limited will be $0.4 per share (D₁). Investors require a 12 % return on companies such as ABC Limited. ABC's dividend increases by 5 % every year. Based on the dividend growth model what is the value of ABC Limited shares today? Price to the nearest cent

(5)A company has annual net operatingcash flow(X) of 1.8 million dollarsin perpetuity and the market value of its capital (V) is10.5 million dollars. What is the company's cost of capital k_o? Provide your answer as a percentage to two decimal places.

(6)Calculate the cost of equity capital using CAPM if the risk-free rate of interest is 4 per cent, the return on the market portfolio is 8 per cent, the beta of the firm's assets is .8 and the and beta of equityis 1.2.

(Please show calculation for understanding. Thank you.)