Below you find the probability distribution for stocks A, B, and for the market

State	Probability	Return, Asset A	Return, Asset B	Market Return
weak market	0.4	10%	0%	5%
strong market	0.6	5%	20%	15%
Expected Market Return				11%
Variance of Market Return				0.0024

a. Find the expected return for asset A. [ Select ] ["7.0%", "7.5%", "8.0%", "10.0%"]

b. Find the expected return for asset B. [ Select ] ["8.0%", "12.0%", "10.0%", "20.0%"]

c. Find the variance of returns for asset A. [ Select ] ["0.0072", "0.0006", "0.0084", "0.0008"]

d. Find the variance of returns for asset B. [ Select ] ["0.0012", "0.0082", "0.0096", "0.0008"]

e. Find the beta with respect to market for asset A [ Select ] ["-0.5", "1", "1.2", "0.5"] .

f. Find the beta with respect to market for asset B [ Select ] ["0.5", "2.0", "1.0", "1.2"] .

g. Suppose you use CAPM in calculating the required rates of return on your investment. You can assume that the risk-free rate is 6%. What is the required expected rate of return on asset A? [ Select ] ["3.5%", "6.0%", "9.0%", "8.5%"]

h. Suppose you use CAPM in calculating the required rates of return on your investment. You can assume that the risk-free rate is 6%. What is the required expected rate of return on asset B? [ Select ] ["16.0%", "8.0%", "3.0%", "12.5%"]

i. Given what you know about assets expected returns and risk, which asset represents the best investment for investors (A or B)? Is investment in asset A and asset B a positive NPV? Choose the most precise statement below. [ Select ] ["For asset A, the expected return exceeds its required return. For asset B, the expected return is below the required return, hence it is not a good investment. Invest in A.", "Both investment A and B are negative NPV. Don't Invest.", "Both investment A and B are positive NPV, but B is better investment.", "For asset A, the expected return is below its required return. For asset B, the expected return exceeds the required return, hence it is not a good investment. Invest in B.", "Both investment A and B are positive NPV, but A is better investment."]

j. You eventually decide to cautiously invest 50% in asset B and 50% in risk-free asset (at 6%). Your portfolio is therefore 50% debt. What is its beta? [ Select ] ["0", "2", "-1", "0.5", "1"]