{ "key_pair_value_system": true, "answer_rating_count": "", "question_feedback_html": { "html_star": "", "html_star_feedback": "" }, "answer_average_rating_value": "", "answer_date_js": "2024-06-09T11:04:58-04:00", "answer_date": "2024-06-09 11:04:58", "is_docs_available": "", "is_excel_available": "", "is_pdf_available": "", "count_file_available": 0, "main_page": "student_question_view", "question_id": "2511494", "url": "\/study-help\/questions\/business-financial-management-practice-problem-15-15-18-points-2511494", "question_creation_date_js": "2024-06-09T11:04:58-04:00", "question_creation_date": "Jun 09, 2024 11:04 AM", "meta_title": "[Solved] Business Financial Management -- Practice | SolutionInn", "meta_description": "Answer of - Business Financial Management -- Practice Problem 15 15) [18 points] Consider the following table: Securig Expected Re | SolutionInn", "meta_keywords": "business,financial,management,--,practice,problem,15,18,points,table,securig,expected", "question_title_h1": "Business Financial Management -- Practice Problem 15 15) [18 points] Consider the following table: Securig Expected Return Beta Standard Deviation Risk-free Asset 2% 0% Market", "question_title": "Business Financial Management -- Practice Problem 15 15) [18 points] Consider the", "question_title_for_js_snippet": "Business Financial Management Practice Problem 15 15) 18 points Consider the following table Securig Expected Return Beta Standard Deviation Risk free Asset 2 0 Market Portfolio 10 10 Stock A 1 5 25 Stock C 0 5 50 a) 6 points Complete the table above by filling the blanks And show the process b) 4 points Calculate the systematic and idiosyncratic risk for Stock A c) 4 points Suppose that you were to run the regression of the excess returns of A on the excess returns of the market portfolio Assume that you have a large number of observations so that your estimates are statistically precise The regression is rA rf a (rm rf) 8 Assuming that the CAPM holds, what are your estimates for a and B for stock A d) 4 points What is the Sharpe Ratio for market portfolio, and Stock A and C Among them, which one gives you best risk adjusted return Using the formula 3 ismRf T", "question_description": "\"image

Business Financial Management -- Practice Problem 15<\/p>

\"image<\/div><\/div><\/div> 15) [18 points] Consider the following table: Securig Expected Return Beta Standard Deviation Risk-free Asset 2% 0% Market Portfolio 10% 10% Stock A 1.5 25% Stock C 0.5 50% a) [6 points] Complete the table above by filling the blanks. And show the process. b) [4 points] Calculate the systematic and idiosyncratic risk for Stock A. c) [4 points] Suppose that you were to run the regression of the excess returns of A on the excess returns of the market portfolio. Assume that you have a large number of observations so that your estimates are statistically precise. The regression is: rA rf = a+(rm rf)+8 Assuming that the CAPM holds, what are your estimates for a and B for stock A? d) [4 points] What is the Sharpe Ratio for market portfolio, and Stock A and C. Among them, which one gives you best risk-adjusted return? Using the formula: 3 _ ismRf] _ T", "transcribed_text": "", "related_book": { "title": "Calculus With Applications", "isbn": "978-0135871348, 0135871344", "edition": "12th Edition", "authors": "Margaret L. Lial", "cover_image": "https:\/\/dsd5zvtm8ll6.cloudfront.net\/si.question.images\/book_images\/6394add235772_20065.jpg", "uri": "\/textbooks\/calculus-with-applications-12th-edition-9780135871348", "see_more_uri": "" }, "free_related_book": { "isbn": "0471496510", "uri": "\/textbooks\/trends-in-organizational-behavior-time-in-organizational-behavior-volume-7-1st-edition-978-0471496519-100634", "name": "Trends In Organizational Behavior Time In Organizational Behavior Volume 7", "edition": "1st Edition" }, "question_posted": "2024-06-09 11:04:58", "see_more_questions_link": "\/study-help\/questions\/business-banking-2021-September-12", "step_by_step_answer": "The Answer is in the image, click to view ...", "students_also_viewed": [ { "url": "\/a-capacitor-with-air-between-its-plates-is-charged-to", "description": "A capacitor with air between its plates is charged to 100 V and then disconnected from the battery. 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