1. You own a stock portfolio, invested 10 percent in Stock Q, 25 percent in Stock R., 50 percent in Stock S, and 15 percent in Stock T. The betas for these four stocks are 1.4, 0.6, 1.5, and 0.9, respectively. What is the portfolio beta? (5 marks) 2. A stock has a beta of .85, the expected return on the market is 11 percent, and the risk-free rate is 3 percent. What must the expected return on this stock be? (5 marks) 3. Use the following information on states of the economy and stock returns to calculate the expected return for Telus Telephone: (5 marks) State of Economy Recession Normal Boom Probability of State of Economy State of Economy Boom Bust 0.25 0.50 0.25 4. Calculate the expected return and standard deviation for a portfolio that has a 35% invested in Stock A, 45% in Stock B and the balance in Stock C (15 marks) Probability of State Stock A of Economy Retur 0.40 0.60 15% 10% Security Return if State Occurs -8% 13% 23% 18% 0% Stock B Return Stock C Retur 20% -10% 5. Broadcom sells for $45 today. The beta of the stock is 1.7 and the expected return on the market is 22 percent. The stock is expected to pay a dividend of $1.00 in one year. If the risk-free rate is 4.5 percent, what should the share price be in one year