Instructions: This questions has many sub questions throughout. The total question is valued at 35 points (the equivalent of three and a half questions)and each sub question is welghted equally. For all responses in this question that ask for a percentage, input your response in percentage terms. For example, if you want to answer 1.23%, put 123 in the box. Hint Betas are not percentages. You have a three-asset portfolio containing only stocks A, B, and C. The weights are wA), w(B) and wiC), respectively. The betas are Bc. Bc. and Be respectively, and Do = 1.25 PA and B = 1.25 x x At time 1 = 0, WA)*w(B) = 40%. Between 1 = 0 and 1 = 1. the stocks prices change according to the following: A: -10%, B: +10% C: +20% What is the beta of the portfolio after the price changes at r = 2? (Express as a multiple of xs so if you get 0.3 x pe, enter only 0.5): XDA At 1-2. Company B changes its structure substantially and the new Br is twice what it was one period before, and keeps this new value throughout the rest of this problem (Note: Pe and Be do not change throughout this problem. Also, after the beta change, the stock prices change according to the following: A-10%, 8: +15%C0% What is the new portfolio beta after the price changes between 1 - 2 and t = 2 (Express as a multiple of xfx. so if you get 0.5 x .enter only 0.5)? XBA We are now at 1 = 3. Assume Stock B has an expected return of 20% and De = 1.5. If the Market Risk Premiums is 12%, what is the E(R) expected return of stocks A and C? Stock A B 20% (Given