No excel answers please need to show work preferably with financial calculator Skip 8.6

Part 3 Financial Assets Problems Easy Problems 8-1 EXPECTED RETURN A stock's retuns have the following distribution Demand for the Probability of This 03 Calculate the stock's expected retum, standard deviation, and ooeffickent of variation PORTFOLIO BETA another $75,000 iested in a slock with a beta od 25. I these are the only twe invesmet in her portiolio, what is her portiolio's beta? REQUIRED RATE OF RETURN On the market is 12% what is the required fate of return on a stock with a beta of 2? EXPECTED AND REQUIRED RATES OF RETURN the mazket risk premium is 4% What is the required retum for the overall stock market? What is the requined rate of return on a sock with a beta of 0.8? 8-2 An individual has $20,000 invested in a stock with a beta of 06 and 8-3 Assume hat themk-the fate is 59%and the fequired num 8-4 Assume that the rakfnv tatr i and 8-5 BETA AND REQUIRED RATE OF RETURN A stock has a required neturm of P%, the risk-free rate is 4% and the market tak premi m is 3%. a What is the stock's beta? b. If the market risk priturn innowd to5% what would happen the d ck's muind rate of return? Assme that the risk-fre rabe and the beta remain unchanged. Intermediate 86 EXPECTED RETURNS Stocks A and B have the following probability distributions of Problems 6-12 expected fubune netur 12 02 a Calculate the expected rate of neturn, i for Stock B - b. Calculate the standard deviation od epected returns o," kr Sh ck A (o.-30,35 Now cakuine the coefficient of variation for Stock ls possible that most investors will negard Stock B as being less risky than Stock At Explain 8-7 PORTFOLIO REQUIRED RETURN Suppose you are the money manager of a 54.82 million investment fund. The fund consists of four stocks with the following investnents and betas 1,310000 075 DEthw market's required rated return is 8% and the risk-free rate is 4% what is the fund's reqaired rate of refurn