1. The average annual return over the period 1886-2006 for stocks that comprise the S&P 500 is 10.5%, and the standard deviation of returns is 17.5%. Based on these numbers what is a 95% confidence interval for 2007 returns? 2. Ford Motor Company had realized returns of 15%, 30%, -20%, and -25% over four quarters. What is the quarterly standard deviation of returns for Ford? 3. Your estimate of the market risk premium is 7%. The risk-free rate of return is 3%, and General Motors has a beta of 1.5. According to the Capital Asset Pricing Model (CAPM), what is its expected return?