Consider the following information for three stocks, Stocks AB, and C. The returns on the three stocks are positively correlated, but they are not perfectly correlated. (That is, each of the correlation coefficients is between 0 and 1.)

Stock |Expected Return|Standard Deviation|Beta

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A| 8.65%| 14%|0.7

B| 10.90 | 14 |1.2

C| 12.25 | 14 | 1.5

Fund P has one-third of its funds invested in each of the three stocks. The risk free rate is 5.5%, and the market is in equilibrium(That is, required returns equal expected returns.) The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below.

a. what is the market risk premium?

b. what id the bets of Fund P?

c. What is the required return of fund p?

d. would you expect the standard deviation of Fund P to be less than 14%, equal to 14%, or grater than 14%?

here's the spread sheet

Excel Online Structured Actuvity: CAPM, portfolio risk, and return Consider the following information for three stocks, Stocks A,,B, and C. The retums on the three stocks are positively correlated, but they are not perfectly correlated. (That is, each of the correlation coefficients is between 0 and 1.) Fund P has one-third of its funds invested in each of the three stocks. The risk-free rate is 5.5%, and the market is in equilibrium. (That is, required returns Equal expected returns.) The data has been collected in the Microson Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. d. Would you expect the standard deviation of Fund P to be less than 14%, equaf to 14%, or greater than 14% ? 1. less than 14% 11. greater than 14% III. equal to 14%