Exhibit 14.11

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

Investment	Beta	Analyst's Estimated Return
Stock X	2.3	15.5%
Stock Y	1.2	13.6%
Market Portfolio	1.0	11.5%
Risk-free rate		4.0%

100. Refer to Exhibit 14.11. What is the required rate of return for Stock X based on the capital asset pricing model (CAPM)?

a.	15.5%
b.	17.3%
c.	21.3%
d.	26.5%
e.	30.5%

101. Refer to Exhibit 14.11. What is the required rate of return for Stock Y based on the capital asset pricing model (CAPM)?

a.	11.5%
b.	13.0%
c.	13.6%
d.	14.8%
e.	15.5%

102. Refer to Exhibit 14.11. Based on the analyst's estimated return and the stocks' betas the analyst should

a.	Sell both Stock X and Stock Y
b.	Sell Stock X and Buy Stock Y
c.	Buy Stock X and Sell Stock Y
d.	Buy both Stock X and Stock Y
e.	None of the above