Lawrence is trying to use the CAPM to estimate the required return for Oracle Corporation, a database software company. He assumes that the expected market return will be 11.03% and the risk free rate will be 2.69%. If Oracle's beta is 0.80, what should Lawrence's required return be?

Multiple Choice

• 9.36%

• 6.67%

• 11.51%

• 2.76%

• The risk-free rate of return is 4.4 percent and the market risk premium is 14 percent. What is the expected rate of return on a stock with a beta of 1.6?

  Multiple Choice

• 13.40%

• 26.80%

• 10.52%

• 22.40%

• 21.04%

• 8.82%

A stock had returns of 14.51 percent, 18.99 percent, 15.43 percent, 12.43 percent, and 25.71 percent for the past five years. What is the variance of the returns?

Multiple Choice

• .15755

• .00299

• .02979

• .02482

• .03309

Suppose the annual returns on a stock over the past five years were as follows:

• 21.23%
• -22.22%
• 2.21%
• 12.38%
• -5.86%

What is the standard deviation of these returns?

Multiple Choice

• 12.38%

• 16.77%

• 1.55%

• 2.81%

• 7.74%