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4. If the beta for a stock decreases from 0.99 to 0.65 . The stock's (2 points) A risk has increased. B. risk has decreased.

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4. If the beta for a stock decreases from 0.99 to 0.65 . The stock's (2 points) A risk has increased. B. risk has decreased. c. sales has increased. D. sales has decreased. E. Not enough information to answer the question. 5. Suppose you purchase 16 shares of Waymon Corp stock for $25.22 per share on June 1 st. On December 27 of the same year, you sold 12 shares of the stock for $32.68 per share. A. Calculate the holding-period dollar gain for the shares you sold, assuming no dividend was distributed. (2 points) B. Calculate the holding-period rate of return. (2 points) 6. Simmons, Inc. is evaluating a security. Calculate the investment's expected return. (3 points) 7. Using CAPM, what is the required return for a stock with a beta of 1.3 ? The market returns 8%, and the risk-free rate is 2%. (3 points)

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