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5) The following table contains data to calculate forward rates using pure expectations theory. a) Find the yield on a 10 year bond, 20 years

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5) The following table contains data to calculate forward rates using pure expectations theory. a) Find the yield on a 10 year bond, 20 years forward (2010). b) Find the yield on a 7 year bond, 3 years forward (3r7). 6) An investor holds a portfolio of stocks and is considering investing in the DBB Company. The firm's prospects look neutral, and you estimate the following probability distribution of possible returns: a) How much is the expected return for DBB? b) How much is the coefficient of variation for DBB? c) Now let's say you want to add another asset, DVI, to your portfolio. You sell 20% of DBB to purchase DVI. How much is your expected return for this portfolio? d) How much is the coefficient of variation for the new portfolio? 5) The following table contains data to calculate forward rates using pure expectations theory. a) Find the yield on a 10 year bond, 20 years forward (2010). b) Find the yield on a 7 year bond, 3 years forward (3r7). 6) An investor holds a portfolio of stocks and is considering investing in the DBB Company. The firm's prospects look neutral, and you estimate the following probability distribution of possible returns: a) How much is the expected return for DBB? b) How much is the coefficient of variation for DBB? c) Now let's say you want to add another asset, DVI, to your portfolio. You sell 20% of DBB to purchase DVI. How much is your expected return for this portfolio? d) How much is the coefficient of variation for the new portfolio

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