e. Constructing a scatter diagram that shows Bartman's and Reynolds's refurns on the vertical axis and the Winslow 5000 Index's returns on the horizontal axis Excel Activity: Evaluating Risk and Return Bartman Industries's and Reynolds Inc.'s stock prices and dividends, along with the Winslow 5000 Index, are shown here for the period 2015-2020. The Winslow 5000 data are adjusted to include dividends. The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the requl analysis to answer the questions below. Do not round intermediate calculations. Use a minus sign to enter negative values, if any. Download spreadsheet Evaluating Risk and Return-23e240.xisx a. Use the data to calculate annual rates of return for Bartman, Reynolds, and the Winslow 5000 Index. calculate each entity's average return over the 5-year period. (Hint: Remember, returns are calculate subtracting the beginning price from the ending price to get the capital gain or loss, adding the divid b. Calculate the standard deviations of the returns for Bartman, Reynolds, and the Winsiow 5000 . (Hint: Use the sample standard deviation formula, which corresponds to the STDEV.S function in Excel.) Round your answers to two decimal places. c. Calculate the coefficients of variation for Bartman, Reynolds, and the Winslow 5000. Round your answers to two decimal places. Assume the risk-free rate during this time was 3%. Calculate the Sharpe ratios for Bartman, Reynolds, and the Index over this period usino their averaae returns. Round vour answers to four decimal olaces. cel Activity-Evaluating Risk and Return d. Assume the risk-free rate during this time was 3%. Calculate the Sharpe ratios for Bartman, Reynolds, and the Index over this period using their average returns. Round your answers to four decimal places. e. Construct a scatter diagram that shows Bartman's and Reynolds's returns on the vertical axis and the Winslow 5000 Index's returns on the horizontal axis. Choose the correct graph. The correct graph is A f. Estimate Bartman's and Reynolds's btas by running regressions of their returns against the index's returns Round your answers to four decimal places. Bartman's beta: Reynolds's beta: Are these betas consistent with your graph? These betas consistent with the scatter diagrams. g. Assume that the risk-free rate on long-term Treasury bonds is 4.5%. Assume also that the average nual return on the Winslow 5000 is not a good estimate of the market's required retum - it is too high. So use 10% as the expected return on the market. Use the SML equation to calculate the two companies' required returns. Round your answers to two decimal places. Bartman's required return: % Reynoids's required return: % h. If you formed a portfolio that consisted of 50% Bartman and 50% Reynolds, what would the portfolio's beta and required return be? Round your answer for the portfolio's beta to four decimal places and for the portfolio's required return to two decimal places. Portfolio's beta: return on the Winslow 5000 is not a good estimate of the market's required return-it is too high. So use 10% as the expected return on the market. Use the SML equation to calculate the two companies' required. returns. Round your answers to two decimal places. Bartman's required return: Reynolds's required return: % h. If you formed a portfolio that consisted of 50% Bartman and 50% Reynolds, what would the portfolio's beta and required return be? Round your answer for the portfolio's beta to four decimal places and for the portfolio's required return to two decimal places. Portfolio's beta: Portfolio's required return: % Suppse an investor wants to include Bartman Industries's stock in his portfolio. Stocks A,B, and C are currently in the portfolio, and their betas are 0.856,0.938, and 1.244 , respectively. Calculate the new portfolio's required return if it consists of 25% of Bartman, 15% of Stock A, 40% of Stock B, and 20% of Stock C. Round your answer to two decimal places. %