Assume that the CAPM is valid. The market portfolio has an expected return equal to $15\%$ and

the risk free rate is $5\%.$ We are mainly interested in $2$ securities in the market; stocks A and B$.$

The beta of stock A is $1\mathrm{.}8$ and the expected return of stock B is $10\%.$

$1.$ Estimate the expected return of stock A$.$

$2.$ Estimate the beta of stock B$.$

$3.$ Estimate the alpha of stock A$.$

$4.$ Estimate the expected return and the beta of an equally weighted portfolio Z consisting of

stocks A and B$.$

$5.$ Estimate the alpha of portfolio Z$.$