1. What is the required rate of return for each stock (CAPM)? Explain the number and put it into context?

2. In what stock(s) (if any) should Sharpe Invest? Make a recommendation of what you would do if you were Alex Sharpe. Would you try something different?

Date	RF (in %)
Jan-02	1.65
Feb-02	1.73
Mar-02	1.79
Apr-02	1.72
May-02	1.73
Jun-02	1.70
Jul-02	1.68
Aug-02	1.62
Sep-02	1.63
Oct-02	1.58
Nov-02	1.23
Dec-02	1.19
Jan-03	1.17
Feb-03	1.17
Mar-03	1.13
Apr-03	1.13
May-03	1.07
Jun-03	0.92
Jul-03	0.90
Aug-03	0.95
Sep-03	0.94
Oct-03	0.92
Nov-03	0.93
Dec-03	0.90
Jan-04	0.88
Feb-04	0.93
Mar-04	0.94
Apr-04	0.94
May-04	1.02
Jun-04	1.27
Jul-04	1.33
Aug-04	1.48
Sep-04	1.65
Oct-04	1.76
Nov-04	2.07
Dec-04	2.19
Jan-05	2.33
Feb-05	2.54
Mar-05	2.74
Apr-05	2.78
May-05	2.84
Jun-05	2.97
Jul-05	3.22
Aug-05	3.44
Sep-05	3.42
Oct-05	3.71
Nov-05	3.88
Dec-05	3.89
Jan-06	4.24
Feb-06	4.43
Mar-06	4.51
Apr-06	4.60
May-06	4.72
Jun-06	4.79
Jul-06	4.95
Aug-06	4.96
Sep-06	4.81
Oct-06	4.92
Nov-06	4.94
Dec-06	4.85

Date	S&P 500	REYNOLDS	HASBRO
2-Jan	-1.70%	6.13%	1.66%
2-Feb	-2.31%	9.87%	-13.27%
2-Mar	4.37%	-1.37%	10.55%
2-Apr	-5.06%	6.87%	1.01%
2-May	-1.19%	2.17%	-4.26%
2-Jun	-7.15%	-23.97%	-11.37%
2-Jul	-8.23%	1.64%	-9.66%
2-Aug	0.64%	7.71%	7.35%
2-Sep	-10.14%	-31.48%	-15.36%
2-Oct	7.35%	0.57%	-8.18%
2-Nov	5.96%	-4.81%	25.44%
2-Dec	-5.50%	9.09%	-9.91%
3-Jan	-2.46%	0.59%	3.90%
3-Feb	-1.72%	-5.78%	0.92%
3-Mar	0.89%	-19.17%	14.70%
3-Apr	8.12%	-12.68%	15.19%
3-May	6.18%	21.02%	0.06%
3-Jun	1.48%	9.15%	9.24%
3-Jul	2.18%	-4.54%	7.78%
3-Aug	2.34%	-3.86%	-1.86%
3-Sep	-1.06%	15.78%	0.97%
3-Oct	5.89%	21.47%	16.70%
3-Nov	1.51%	14.93%	1.42%
3-Dec	4.39%	5.34%	-3.75%
4-Jan	2.20%	1.56%	-7.19%
4-Feb	1.40%	4.52%	10.73%
4-Mar	-1.20%	-1.99%	-0.55%
4-Apr	-2.56%	7.06%	-13.15%
4-May	1.24%	-13.23%	4.08%
4-Jun	2.00%	20.27%	-3.36%
4-Jul	-3.88%	6.45%	-4.37%
4-Aug	0.11%	4.93%	1.98%
4-Sep	1.91%	-9.88%	1.46%
4-Oct	1.66%	1.21%	-5.90%
4-Nov	4.43%	9.83%	7.57%
4-Dec	3.34%	3.93%	1.84%
5-Jan	-2.74%	2.32%	1.14%
5-Feb	2.09%	1.90%	7.76%
5-Mar	-1.86%	-1.66%	-3.17%
5-Apr	-2.66%	-3.25%	-7.48%
5-May	3.59%	6.34%	6.66%
5-Jun	0.99%	-4.96%	3.02%
5-Jul	4.22%	5.72%	5.53%
5-Aug	-0.78%	0.76%	-5.65%
5-Sep	0.93%	-1.10%	-5.07%
5-Oct	-2.19%	2.38%	-4.12%
5-Nov	3.82%	4.73%	8.39%
5-Dec	0.19%	7.09%	-1.18%
6-Jan	3.90%	6.08%	5.05%
6-Feb	-0.36%	4.96%	-4.29%
6-Mar	1.76%	-0.61%	3.99%
6-Apr	1.15%	3.93%	-6.59%
6-May	-3.30%	0.26%	-5.94%
6-Jun	-0.19%	4.88%	-2.32%
6-Jul	-0.28%	9.96%	3.26%
6-Aug	2.30%	2.65%	8.56%
6-Sep	1.81%	-4.76%	12.07%
6-Oct	3.60%	1.92%	13.93%
6-Nov	2.13%	1.71%	3.20%
6-Dec	0.91%	1.91%	1.87%