Keep the Highest: 14 5. Portfolio risk and return Aa Aa Ariel holds a $5,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock's beta, is listed in the following table: TIT Stock Investment Beta Standard Deviation Perpetualcold Refrigeration Co. (PRC) $1,750 0.80 15.00% Zaxatti Enterprises (ZE) $1,000 1.70 11.50% Three Waters Co. (TWC) 1.15 16.00% $750 Mainway Toys Co. (MTC) 0.50 25.50% $1,500 Suppose all stocks in Ariel's portfolio were equally weighted. Which of these stocks would contribute the Suppose all stocks in the portfolio were equally weighted. Which of these stocks would have the least amount of least market risk to the portfolio? standalone risk? Zaxatti Enterprises O Perpetualcold Refrigeration Co. O Three Waters Co. Zaxatti Enterprises Perpetualcold Refrigeration Co. Mainway Toys Co. Mainway Toys Co. Three Waters Co. If the risk-free rate is 7 % and the market risk premium is 9%, what is Ariel's portfolio's beta and required return? Fill in the following table: Betat Required Return Ariel's portfolio 0.943 0.632 1.415 0.802 5. Portfolio risk and return Aa Aa Ariel holds a $5,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock's beta, is listed in the following table: Stock Investment Beta Standard Deviation Perpetualcold Refrigeration Co. (PRC) Zaxatti Enterprises (ZE) $1,750 0.80 15.00% $1,000 1.70 11.50% Three Waters Co. (TWC) $750 1.15 16.00% Mainway Toys Co. (MTC) $1,500 0.50 25.50% Suppose all stocks in Ariel's portfolio were equally Suppose all stocks in the portfolio were equally weighted. weighted. Which of these stocks would contribute the Which of these stocks would have the least amount of least market risk to the portfolio? standalone risk? O Zaxatti Enterprises Zaxatti Enterprises Perpetualcold Refrigeration Co. O Three Waters Co. Perpetualcold Refrigeration Co. Mainway Toys Co. Three Waters Co. Mainway Toys Co. If the risk-free rate is 7% and the market risk premium is 9 % , what is Ariel's portfolio's beta and required return? Fill in the following table: Beta Required Return Ariel's portfolio 19.21% 12.08% 15.49 % 8.89% O000