Donald Gilmore has $100,000 invested in a 2-stock portfolio. $67,500 is invested in Stock X and the remainder is invested in Stock Y. X's beta is 1.50 and Y's beta is 0.70. What is the portfolio's beta?

Select the correct answer.

a. 1.12

b. 1.15

c. 1.18

d. 1.21

e. 1.24

Zacher Co.'s stock has a beta of 0.82, the risk-free rate is 4.25%, and the market risk premium is 5.50%. What is the firm's required rate of return?

Select the correct answer.

a. 8.86%

b. 8.96%

c. 8.76%

d. 9.06%

e. 9.16%

Porter Plumbing's stock had a required return of 13.00% last year, when the risk-free rate was 5.50% and the market risk premium was 4.75%. Then an increase in investor risk aversion caused the market risk premium to rise by 2%. The risk-free rate and the firm's beta remain unchanged. What is the company's new required rate of return? (Hint: First calculate the beta, then find the required return.)

Select the correct answer.

a. 16.16%

b. 14.16%

c. 14.66%

d. 15.16%

e. 15.66%

Stock A's stock has a beta of 1.30, and its required return is 11.25%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint: First find the market risk premium.)

Select the correct answer.

a. 8.80%

b. 8.85%

c. 8.75%

d. 8.90%

e. 8.95%

Fiske Roofing Supplies' stock has a beta of 1.23, its required return is 12.00%, and the risk-free rate is 4.30%. What is the required rate of return on the market? (Hint: First find the market risk premium.)

Select the correct answer.

a. 10.56%

b. 10.24%

c. 10.32%

d. 10.40%

e. 10.48%