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3.] Discuss how you would use CAPM to value a risky cash ow (10 marks} 3.2 Discuss how you would use CAPM to evaluate performance

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3.] Discuss how you would use CAPM to value a risky cash ow (10 marks} 3.2 Discuss how you would use CAPM to evaluate performance of an equity fund given information on its \"alpha" and \"beta\". Draw a graph to illustrate your answer. (10 marks) 3.3 Suppose there are only two stocks in the stock market. Stock A sells for $50 and has 100 shares outstanding. Stock B sells for $100 and has 150 shares outstanding. Assume that there is a risk-free asset. What is the market portfolio in this economy? If the beta of stock A is 1.8, what is the beta of stock B

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