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6. The following are the historic returns for the Chelle Computer Company: Year Chelle Computer General Index 15 13 -11 14 QUAUNE -9 12 Fa-ed

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6. The following are the historic returns for the Chelle Computer Company: Year Chelle Computer General Index 15 13 -11 14 QUAUNE -9 12 Fa-ed on this information com, te the 10wOwing The correlation coe.ficient between Chelle Computer and the Gene .. Inde. D the tandard deviat.on .or the company and the index. Ine ceta for the Chele Computer Company B. . an equity analyst you have developed the for0.ing ret neorecast and isn eat.mate. or two different toc. want al luna : Funa T and runa U) Forecasted Return CAPM Beta Fund T 9.0%% 1.20 Fund U 10.0 0.80 " I. the risk free rate .> > 9 percent and the expected market risk premium ie. Em J FK) is o 1 percent calculate the expected eturn for each mutual buna according to the C. .. M. D U_ing the estimated expected returns from wart a along with your own return forecasts demonstrate whether Luna T and Fund U are currently priced to raid directly on the security mamet .ine (SML) above the ball or below the SML L According to you. anday_is. are Fund. T and U overvalued, dervalued, or properly valued? 10 Draw the security market line for each of the following condition.: " (1) RF. = 0.08; n_( romy) = 0 12 (2) h, = 0.06; n (true) = 0 15 b. Roder Tire has the folloing results fo the lost ix period.. Calculate and compare the betas

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