3) On a risk/return basis, rank order the following asset classes from

lowest to highest based on the following data. (a) Small stocks: E(r) =

18.15% and standard deviation = 36.94%; (b) Large stocks: E(r) =

11.50% and standard deviation = 20.14%; (c) US Treasury bonds:

E(r) = 5.45% and standard deviation = 8.06%; How would this rank

order change if the return for each class [i.e., the E(r)] were each

reduced by a 3% inflation factor?

4) If a stock's Beta is 1.25, and the average market return for the

stock is 12%, and the interest yield on 10-year US Treasury Bonds is

4%, what is the required or expected rate of return?

5) If a stock's required or expected rate of return is 22%, its average

market return is 18%, and the interest yield on 10-year US Treasury

Bonds is 4%, what is the stock's Beta?