6 (5 points) You own a portfolio consisting of five securities as follows: Security ABCDE Number of shares Expected Price/share Return 200 $ 16.00 13.80% 300 $ 12.00 12.10% 400 $ 14.00 4.40% 500 $ 10.00 11.70% 600 $ 20.00 24.30% What is the expected return of this portfolio? (Round your answer to the nearest hundredth; two decimal places) Your Answer: Question 7 (5 points) ABC just paid an annual divided of $2.75 per share, with a plan to increase it by 2% per year indefinitely. What is ABC's cost of equity if its current stock price is $50.75? (Round your answer to the nearest hundredth; two decimal places) Your Answer: Answer Question 8 (5 points) XYZ corp. has 20,000 shares of common stocks outstanding that are currently traded for $13 per share and have a rate of return of 5.40%. They also have 4,000 shares of 6.80% preferred stocks that are selling for $69.5 per share. The preferred stock has a par value of $100. Finally, they have 7,000 bonds outstanding that mature in 11 years, have par value (face value) of $1,000, and sell for 97.5% of par. The yield-to- maturity on the debt is 5.00%. What is the XYZ's weighted average cost of capital if the tax rate is 21%? (Use two decimal places when solving this problem) Your Answer: Answer Question 5 (5 points) You are analyzing a stock that has the following returns given the various states of economy. State of ProbabilityReturn Economy Recession 0.12 -7.80 Normal 0.68 6.00 Boom 0.2 15.40 What is the expected return on this stock? (Round your answer to the nearest hundredth; two decimal places) Your