7.

Suppose you manage a $5.65 million fund that consists of four stocks with the following investments:

StockInvestmentBetaA$500,000 1.50 B750,000 -0.50 C1,500,000 1.25 D2,900,000 0.75

If the market's required rate of return is 9% and the risk-free rate is 6%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal places.

%

5. Expected Returns: Discrete Distribution

The market and Stock J have the following probability distributions:

Probabilityr_Mr_J 0.316%22% 0.48 3 0.318 12

Calculate the expected rate of return for the market. Round your answer to two decimal places.

%

Calculate the expected rate of return for Stock J. Round your answer to two decimal places.

%

Calculate the standard deviation for the market. Do not round intermediate calculations. Round your answer to two decimal places.

%

Calculate the standard deviation for Stock J. Do not round intermediate calculations. Round your answer to two decimal places.

%