1) Stocks A and B have the following probability distributions of expected future returns:

Probability	A	B
0.1	-13%	-36%
0.2	2	0
0.4	10	22
0.2	24	28
0.1	40	43

A) Calculate the expected rate of return, rB, for Stock B (rA = 11.90%.) Do not round intermediate calculations. Round your answer to two decimal places. %_________

B) Calculate the standard deviation of expected returns, A, for Stock A (B = 20.90%.) Do not round intermediate calculations. Round your answer to two decimal places. %_______

C) Now calculate the coefficient of variation for Stock B. Round your answer to two decimal places._______

2) You have been managing a $5 million portfolio that has a beta of 1.90 and a required rate of return of 13%. The current risk-free rate is 7.00%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.90, what will be the required return on your $5.5 million portfolio? Do not round intermediate calculations. Round your answer to two decimal places._________

3) Stock R has a beta of 2, Stock S has a beta of 0.5, the required return on an average stock is 9%, and the risk-free rate of return is 6%. By how much does the required return on the riskier stock exceed the required return on the less risky stock? Round your answer to two decimal places.___________

4) Beale Manufacturing Company has a beta of 1.9, and Foley Industries has a beta of 0.85. The required return on an index fund that holds the entire stock market is 9.5%. The risk-free rate of interest is 6.75%. By how much does Beale's required return exceed Foley's required return? Round your answer to two decimal places._________%