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5. Stock X has a 10% expected return, a Beta coefficient of .9, and a 35% standard deviation of expected return. Stock Y has a
5. Stock X has a 10% expected return, a Beta coefficient of .9, and a 35% standard deviation of expected return. Stock Y has a 12.5% expected return, a bet coefficient of 2, and a 25% standard deviation. The risk free rate is 2% and the market risk premium is 5%
- Calculate each stocks coefficient of variation.
- Which stock is riskier?
- Calculate each stocks required rate of return.
- Calculate the required rate of return of a portfolio that has $7,500 invested in Stock X and $2,500 invested in Stock Y.
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