Problem 2. CAPM. Please fill in the cells highlighted in GREEN. Problem 2.1: Consider the following data of a portfolio with stock C and D. Give the beta of the portfolio and the beta of stock C, what is the beta of stock D? Proportion of C 75% Proportion of D 25% 1.3 1.8 BD B Problem 2.2: Given expected market return, risk free rate, and the beta of stock i, what is the expected return stock i? Erm) 18% 1.05 7% E(r) Problem 2.3: Given expected market return, risk free rate, covariance between a stock and the market portfolio, and the variance of the market portfolio, what is the beta and expected return of the stock? Erm) 20% Cov(ri, M) 0.1 6% Var(rm) 0.15 Eln) Problem 2. CAPM. Please fill in the cells highlighted in GREEN. Problem 2.1: Consider the following data of a portfolio with stock C and D. Give the beta of the portfolio and the beta of stock C, what is the beta of stock D? Proportion of C 75% Proportion of D 25% 1.3 1.8 BD B Problem 2.2: Given expected market return, risk free rate, and the beta of stock i, what is the expected return stock i? Erm) 18% 1.05 7% E(r) Problem 2.3: Given expected market return, risk free rate, covariance between a stock and the market portfolio, and the variance of the market portfolio, what is the beta and expected return of the stock? Erm) 20% Cov(ri, M) 0.1 6% Var(rm) 0.15 Eln)