Question
1)Suppose you invest 52%, 19%, and 29% of your wealth into a stock, the market, and a risk-free asset, respectively. The beta of the stock
1)Suppose you invest 52%, 19%, and 29% of your wealth into a stock, the market, and a risk-free asset, respectively. The beta of the stock is 0.5. What is the beta of the portfolio? Enter your answer rounded to 3 DECIMAL PLACES.
2)Consider a stock that has a covariance of returns to the market of 0.0654. The standard deviation of the market is 0.221. What is the beta of this stock? Enter your answer rounded to 2 DECIMAL PLACES.
3)Given a risk-free rate of 1.4%, a market risk premium of 10.1%, and a beta of 1.7, what is the expected return of the stock? Enter your answer as a percentage and rounded to 2 DECIMAL PLACES.
4)The market risk premium is 13.6% and the risk-free rate is 3.3%. The beta of the stock is 0.95. What is the required return of the stock? Enter you answer as a percentage.
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