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1. Stock (Ticker Symbol) Value Line Yahoo! Finance Amazon.com (AMZN) 1.2 1.39 Apple (AAPL) 0.95 1.34 Coca-Cola (KO) 0.7 0.63 Duke Energy Corp. (DUK) 0.60

1.

Stock (Ticker Symbol)

Value Line

Yahoo! Finance

Amazon.com (AMZN)

1.2

1.39

Apple (AAPL)

0.95

1.34

Coca-Cola (KO)

0.7

0.63

Duke Energy Corp. (DUK)

0.60

0.01

Energen Corp. (EGN)

1.70

2.10

General Electric (GE)

1.05

0.99

Microsoft Corp. (MSFT)

1.10

1.50

Procter & Gamble (PG)

0.70

0.47

Tesla (TSLA)

1.30

0.73

Explain the CAPM model. The above is a list of betas for a selection of stocks. Choose two firms from the list and discuss whether the betas are what you would expect. Be sure to explain why or why not. Calculate the returns based on the CAPM model. Be sure to state your assumptions.

2. In your opinion, what is a good beta for a stock? Please comment.

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