If the expected return of the market portfolio is estimated to be 18 %, the risk-free interest rate is 8 %, and the beta of asset i is 0.80 , what is the expected return of asset i using the CAPM model?
____ %

Put your answer as a PERCENT using two decimal places and no percent sign. For example, if your answer is seven point five two percent, enter 7.52.

Financial analysts have estimated the returns for Drucker Corporation stock and the overall market portfolio under various economic conditions as follows. Drucker's performance in the following three natural economic states is projected to be: -18 % in recession, + 11 % in moderate growth, and + 33 % in the boom. Estimates for the market as a whole in the same economic states are -12 % in a recession, + 10 % in moderate growth and + 25 % in the boom. The analyst considers each state to be equally likely. Using these data, calculate the beta for Drucker Corporation stock.


Put your answer as a number with at least three decimal places.

The Toyota Corp. stock price has a variance of returns equal to 0.0295. The stock price of Honda Corp. has a variance of returns equal to 0.0505. The covariance between Toyota and Honda is 0.0675. What is the standard deviation of a portfolio made up of 50% Toyota and 50% Honda?

*Place your answer in decimal form.

Toyota Corp.'s stock price has a variance of returns of 0.0295. Shares of Honda Corp. have a variance of returns of 0.0495. The covariance between Toyota and Honda is 0.0285. What is the correlation coefficient between Toyota and Honda?

*Use at least four decimal places in your answer.

Rush Corporation's return in the recession state is estimated at -25 % and Rush's return in the boom state is estimated at 35 %. Oberman Corporation's return in the recession state is estimated to be 43 % and Oberman's return in the boom state is estimated at -15 %. Given this information, what is the covariance between Rush and Oberman if there is a 0.60 probability that the economy is in a boom state and a 0.40 probability that the economy is in a recession state?

Put your answer in decimal form and not as a percentage.