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Question 3 (total of 20 marks): Refer to the below table to answer the questions that follow. Assume that returns are effective annual rates Year

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Question 3 (total of 20 marks): Refer to the below table to answer the questions that follow. Assume that returns are effective annual rates Year Return on Stock A Return on Market 2007 35% 15% 2008 -35% -25% 2009 15% 40% Question 3a (1 marks): What is stock A's expected return? Question 3b (1 marks): What is the market's expected return? Question 3c (4 marks): What is the sample standard deviation of stock A's returns? buestion 3d (4 marks): What is the sample standard deviation of the market portfolio's returns? 3e (4 marks): What is the covariance of stock A's returns with the market portfolio? Question 3f (2 marks): What is the correlation of returns between stock A and the market? Question 3g (2 marks): What is the beta of stock A? Question 3h (2 marks): What is the diversifiable variance of stock A

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