1. Suppose the expected market risk premium is 7.5 percent and the risk free rate is 3.7 percent. The expected return on TriStar's stock is 14.2 percent. Assume the capital-asset-pricing-model holds. What is the beta of TriStar's stock? 2. Consider the following two stocks: Beximco Bet a Expected (%) Return 1.4 25 0.7 14 Pharma BSRM Steel Assume the capital-asset-pricing-model holds. Based on the CAPM, what is the risk-free rate? What is the expected return on the market portfolio? 3. Suppose the risk-free rate is 3 percent, the expected return on the market portfolio is 13 percent, and its standard deviation is 23 percent. An Indian company, Bajaj Auto, has a standard deviation of 50 percent but is uncorrelated with the market. Calculate Bajaj Auto's beta and expected return. Ans: 3% 4. Suppose the risk-free rate is 3 percent, the expected return on the market portfolio is 13 percent, and its standard deviation is 23 percent. A German Company, Mueller Metals, has a standard deviation of 50