Figure 12.11 shows plots of monthly rates of return on three stocks versus the stock market index. The beta and standard deviation of each stock is given beside its plot. Required: a. Which stock is safest for a diversified investor? b. Which stock is safest for an undiversified investor who puts all her funds in one of these stocks? c. Consider a portfolio with equal investments in each stock. What would this portfolio's beta have been? d. Consider a well-diversified portfolio made up of stocks with the same beta as Intel. What are the beta and standard deviation of this portfolio's return? The standard deviation of the market portfolio's retum is 20%. e. What is the expected rate of return on each stock? Use the capital asset pricing model with a market risk premium of 8%. The risk- free rate of interest is 4%. Complete this question by entering your answers in the tabs below JUL_12TICON.JPY Pac RGURE 12.11 Monthly rates er for Marathon OL di Walmart, plus the are portfolio for the years ending December 2017 40% 30K 203 10 -OR -5% 70% Marathon O return) -28% Bets 2.39 Std day-43.73 -20% (b) 30% 25 20 159 103 5 Intereum (N) OM 5 1.10 15 De 107 Side 305 OR Market return(0) FIGURE 12.11 continued 10) Ic 30% 25% 20 5. 10 on Wat 1 Dets -20 Petrum