Question
Answer all please 1. Uptown Industries just decided to save $300,000 a quarter for the next three years. The APR is 4 percent, paid quarterly.
Answer all please
1. Uptown Industries just decided to save $300,000 a quarter for the next three years. The APR is 4 percent, paid quarterly. If the company had wanted to deposit one lump sum today, rather than make quarterly deposits, how much would it have had to deposit today to have the same amount saved at the end of the three years?
2. The risk-free asset has a return of 5%. The market portfolio has an expected return of 20% and a standard deviation of 40%. A portfolio that holds both assets has an expected return of 27.5%. This portfolio also has:
(I) A standard deviation larger than 40%.
(II) A negative weight in the risk-free asset.
(III) A positive weight in the risk-free asset.
3. Stock A has an expected return of 2% and a standard deviation of 8%, while stock B has an expected return of 1% and a standard deviation of 5%. The correlation between Stock A and
Stock B is 0.10. You decided to invest $5,000 in Stock A and $20,000 in Stock B. What is the portfolios expected return?
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