Question
1.) What are the portfolio weights for a portfolio that has 170 shares of Stock A that sell for $91 per share and 145 shares
1.) What are the portfolio weights for a portfolio that has 170 shares of Stock A that sell for $91 per share and 145 shares of Stock B that sell for $110 per share?(Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.1616.)
2.) A portfolio is invested 20 percent in Stock G, 35 percent in Stock J, and 45 percent in Stock K. The expected returns on these stocks are 8.5 percent, 11 percent, and 16.4 percent, respectively.
-What is the portfolio's expected return?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)
3.) Consider the following information:
State of Probability of Rate of Return If State occurs
Economy State of Economy Stock A Stock B Stock C
Boom .18 .353 .453 .333
Good .42 .123 .103 .173
Poor .32 .013 .023 -.053
Bust .08 -.113 -.253 -.093
a.) Your portfolio is invested 29 percent each in A and C and 42 percent in B. What is the expected return of the portfolio?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)
b.) What is the variance of this portfolio?(Do not round intermediate calculations and round your answer to 5 decimal places, e.g., 32.16161.)
c.) What is the standard deviation of this portfolio?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)
A stock has a beta of 1.17, the expected return on the market is 11.1 percent, and the risk-free rate is 4.9 percent.
4.) What must the expected return on this stock be?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
5.) Consider the following information on a portfolio of three stocks:
State of Probability of Rate of Return If State occurs
Economy State of Economy Stock A Stock B Stock C
Boom .15 .02 .32 .60
Normal .55 .10 .12 .20
Bust .30 .16 -.11 -.35
a.If your portfolio is invested 40 percent each in A and B and 20 percent in C, what is the portfolio's expected return, the variance, and the standard deviation?(Do not round intermediate calculations. Round your varianceanswer to 5 decimal places, e.g., 32.16161. Enter your other answers as a percent rounded to 2 decimal places, e.g., 32.16.)
b.If the expected T-bill rate is 3.75 percent, what is the expected risk premium on the portfolio?(Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)
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