Problem THREE

Using the following information:

Investment	Amount	Beta
SeaSide Inn	$ 110,000	1.25
Sand Ventures	$ 75,000	2.3
Sky Coaster	$ 35,000	1.7

CALCULATE:

Portfolio BETA

Part Two

Using the following information:

	2015	2016	2017	2018	2019
MARKET	8.2	<13.4>	15.1	32.5	13.7
STOCK W	<10.1>	<15.5>	5.8	10.75	17.5

CALCULATE:

Beta (slope)

Alpha (intercept)

CORR (correlation)

(Goodness of Fit)

ANSWER:

How much of the return on STOCK W is explained by the return on the MARKET?