Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer all parts thankyou ! 1)Stock X has a 10.0% expected return, a beta coefficient of 0.9, and a 40% standard deviation of expected

please answer all parts thankyou !
1)Stock X has a 10.0% expected return, a beta coefficient of 0.9, and a 40% standard deviation of expected returns. Stock Y has a 12.5% expected return, a beta coefficient of 1.2, and a 30% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%.
Calculate each stock's coefficient of variation. Do not round intermediate calculations. Round your answers to two decimal places.
CVx = ___
CVy = ___
2)Calculate each stock's required rate of return. Round your answers to one decimal place.
rx = ___%
ry = ___%
3)Calculate the required return of a portfolio that has $6,000 invested in Stock X and $2,000 invested in Stock Y. Do not round intermediate calculations. Round your answer to two decimal places.
rp = ___ %

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Exchange Traded Funds Manual

Authors: Gary L. Gastineau

2nd Edition

0470482338, 978-0470482339

More Books

Students also viewed these Finance questions