6. If you purchase a stock for $50 receive dividends of S2, and sell the stock at the end of the year for $55, what is your holding period return? A) 5% B) 10% C) 14% D) 18% 7. Consider the CAPM. The risk-free rate is 6% and the expected return on the market is 18%. What is the expected retum on a stock with a beta of 1.3? A) 29.4% B) 15.6% C) 18% D) 21.6% index. 8. The Dow Jones Industrial Average is A) a price-weighted B) a value-weighted an equally-weighted a dividend-weighted 9. Stock A has an expected return of 15%. Stock B has an expected return of 5%. What is the expected return of a portfolio that invests 60% in stock A and 40% in stock B? D) A) 15% 5% C) 10% D) 11% 10. Stock C has a return standard deviation of 19%. Stock D has a retum standard deviation of 13%. If the correlation between C and Dis 0.25, what is the standard deviation of a portfolio that invests 40% in C and 60% in D? A) 1.48% B) 11.55% C) 12.18% D) 15.40% 11. An investor is considering adding another investment to a portfolio. To achieve the maximum diversification benefits, the investor should add, if possible, an investment that has which of the following correlation coefficients with the other investments in the portfolio? A) -1.0 B) -0.5 C) 0.0 D) +1.0