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Portfolio Manager is maintaining the following data of stock Q and R: Stock Q Stock R Weight 80% 20% Beta 0.9 1.3 Total Retum 12%

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Portfolio Manager is maintaining the following data of stock Q and R: Stock Q Stock R Weight 80% 20% Beta 0.9 1.3 Total Retum 12% 13% Market Risk Premium 7% 7% Risk Free Rate 4% 4% Determine the Required for Expected) Return of stock Q and R using Capital Asset Pricing Model (CAPM) W. Expected Return of a portfolio 111. Actual Return of a portfolio I. Alpha generated by portfolio manager (2+2+2+1 = 7 marks) For the toolbar, press ALT+F10 (PC) or ALT+FN-F10 (Mac), BIVS Paragraph Arial 10pt A 2 I. XO

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