Company Yahoo Finance (Yahoo.com) Computers and Software Apple Inc. (AAPL) 2.13 Dell Inc. (DELL) 1.83 Hewlett Packard (HPQ) 1.42 Utilities American Electric Power Co. (AEP) 0.61 Duke Energy Corp. (DUK) 0.53 Centerpoint Energy (CNP) 0.95

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Part 1

(Related to Checkpoint 8.3) (Systematic risk and expected rates of return)The following table,

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,

contains beta coefficient estimates for six firms. Calculate the expected increase in the value of each firm's shares if the market portfolio were to increase by 10 percent. Perform the same calculation where the market drops by 10 percent. Which set of firms has the most variable or volatile stock returns?

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Part 1

Input the expected increase in the value of each firm's shares if the market portfolio were to increase by 10%.(Round each answer to two decimal places.)

Company	Yahoo Finance (Yahoo.com) Beta Estimate	Expected Increase
Computers and Software
Apple Inc. (AAPL)	2.13	enter your response here%
Dell Inc. (DELL)	1.83	enter your response here%
Hewlett Packard (HPQ)	1.42	enter your response here%
Utilities
American Electric Power Co. (AEP)	0.61	enter your response here%
Duke Energy Corp. (DUK)	0.53	enter your response here%
Centerpoint Energy (CNP)	0.95	enter your response here%

Part 2

Input the expected decrease in the value of each firm's shares if the market portfolio were to decrease by 10%.(Round each answer to two decimal places.)

Company	Yahoo Finance (Yahoo.com) Beta Estimate	Expected Decrease
Computers and Software
Apple Inc. (AAPL)	2.13	enter your response here%
Dell Inc. (DELL)	1.83	enter your response here%
Hewlett Packard (HPQ)	1.42	enter your response here%
Utilities
American Electric Power Co. (AEP)	0.61	enter your response here%
Duke Energy Corp. (DUK)	0.53	enter your response here%
Centerpoint Energy (CNP)	0.95	enter your response here%

Part 3

Which set of firms has the most variable or volatile stock returns?(Select the best choice below.)

A.

Computer and Software firms

B.

Utilities