I need (5) and part B pls.

Provide your answers and show your work. a A. XYZ stock has a standard deviation of return of 9.39%. A stock market index has a standard deviation of return of 6.84%. The correlation coefficient between stock return and stock stock index return is 0.93. The stock is expected to pay dividend of $3 in one year and its expected price in one year is $60. The risk-free rate is 3%. The stock market index has an expected return of 12%. (1) Estimate the beta of the stock. Does the stock have a greater risk than the stock market index? Explain. (2) Use the security market line to determine the required rate of return of the stock. (3) Determine the value of the stock. (4) If the current price of the stock is $48, what is the expected return? Would you invest in the stock? Explain. (5) If the current price of the stock is $45, what is the expected return? Would you invest in the stock? Explain. B. Stock A has an expected return of 10%, while Stock B has an expected return of 20%. Stock A has a standard deviation of return of 12% while stock B has a standard deviation of return of 30%. (1) What will be the expected return of a portfolio composed of 50% Stock A and 50% Stock B? (2) What will be the standard deviation of a portfolio composed of 50% Stock A and 50% Stock B when risk reduction may be achieved by diversification? (Give a range.) a) a Beta=Correlation*SD of stock/SD of market =0.939.39%/6.84% -1.28 The stock is riskier than stock market index since the stock's beta is higher than 1 which is market beta. b) Required return Rf+BxRp Here, 3.00% Risk free rate of return (RF) Beta of the stock (B) Market risk premium (Rp) 1.28 9.00% -12%-3% Required return 14.52% 3%+1.28x9% c) Present value D1 3.00 PVIF @ 14.52% 0.873 0.762 0.762 D2 3.00 2.62 2.29 45.75 P2 60.00 Value of the stock 50.66 Part D) Current markete price =48 Then expected rate of return = 17.732% Required return = 14.52%