Question
Evaluating risk and return Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard deviation of expected returns. Stock
Evaluating risk and return
Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard deviation of expected returns. Stock Y has a 12.0% expected return, a beta coefficient of 1.1, and a 30.0% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%.
Calculate each stock's coefficient of variation. Round your answers to two decimal places. Do not round intermediate calculations. CVx = CVy =
Calculate each stock's required rate of return. Round your answers to two decimal places. rx = % ry = %
Calculate the required return of a portfolio that has $3,500 invested in Stock X and $7,000 invested in Stock Y. Do not round intermediate calculations. Round your answer to two decimal places. rp = %
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