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4. You are asked to estimate the return from a stock based on the following information: Rf= 2%, Risk premium = 6%, and stock Beta

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4. You are asked to estimate the return from a stock based on the following information: Rf= 2%, Risk premium = 6%, and stock Beta of .95. The Expected return is: a. 7.07% b. 7.7% c. 5.8% d. 7.8% e. 7% 5. Citibank economists project the following scenarios for 2021: 35% chance of recession, 45% chance of a neutral economy and the remaining chance of a boom. Given the following returns for your portfolio for each scenario [-18%, 12% & 17%, respectively), calculate the expected return of your portfolio. a. 25% b. 15.1% c. -2.5% d. 2.5% e. -8.4% 6. You are constructing a portfolio of two assets with a desired portfolio Beta of 1.25. If the two assets are equally weighted and the Beta of one asset is 0.9, what is the Beta of the other? a. 1.5 b. 1.75 c. 1.1 d. 2.0 e. 1.6

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