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Q13) The market risk premium for next period is 8.53% and the risk-free rate is (1.94%. Stock Zhas a beta of 0.837 and an expected
Q13) The market risk premium for next period is 8.53% and the risk-free rate is (1.94%. Stock Zhas a beta of 0.837 and an expected return of 11.94%. Compute the following: a) Market's reward-to-risk ratio : (0.75 points) b) Stock Z's reward-to-risk ratio : (0.75 points) Q14) An analyst gathered the following information for a stock and market parameters: stock beta= 1.230; expected return on the Market = 10.10%; expected return on T-bills =4.20%; current stock Price = $5.04; expected stock price in one year = $9.61; expected dividend payment next year= $3.18. Calculate the a) Required return for this stock (1.25 points): b) Expected return for this stock (1.25 points): Q15) The market risk premium for next period is 7.40% and the risk-free rate is 3.10%. Stock Z has a beta of 0.650 and an expected return of 8.20%. What is the: a) Market's reward-to-risk ratio? (1 point): b) Stock Z's reward-to-risk ratio (1 point): Q16) You are invested 23.10% in growth stocks with a beta of 1.537,20.30% in value stocks with a beta of 0.785, and 56.60% in the market portfolio. What is the beta of your portfolio? (1 point)
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