Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Toyota Corp.'s stock is $ 30 per share. Its expected return is 22 % and variance is 15 %. Honda Corp.'s stock is $

1. Toyota Corp.'s stock is $30 per share. Its expected return is 22% and variance is 15%. Honda Corp.'s stock is $22 per share. Its expected return is 17% and variance is 8%. Benz Corp.'s stock is $50 per share. Its expected return is 10% and variance 7%. What would be the expected return of a portfolio consisting of 50% Toyota and 50% Honda? % _____ * Place your answer in percentage form, say 5.99% and not .0599

2. Toyota has an expected return of 20%, and a variance of 0.011. Honda has an expected return of 20%, and a variance of 0.005. The covariance between Toyota and Honda is 0.08. Using these data, calculate the variance of a portfolio consisting of 50% Toyota and 50% Honda.

3. Toyota Corp.'s stock price has a variance of returns of 0.0250. Honda Corp.'s stock has a variance of returns of 0.0425. The covariance between Toyota and Honda is 0.0295. What is the correlation coefficient between Toyota and Honda? *Use at least four decimal places in your answer.

4. Toyota Corp.'s stock price has a variance of returns equal to 0.0335. Honda Corp.'s stock price has a variance of returns equal to 0.0495. The covariance between Toyota and Honda is 0.0695. What is the standard deviation of a portfolio consisting of 50% Toyota and 50% Honda? *Place your answer in decimal form

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

American Public School Finance

Authors: William A. Owings, Leslie S. Kaplan

1st Edition

0495807834, 9780495807834

More Books

Students also viewed these Finance questions

Question

How much can you spend?

Answered: 1 week ago

Question

When do you need them by?

Answered: 1 week ago