Related to 8.3

A. Given the following holding-period returns, compute the average returns and the standard deviations for the Sugita Corporation and for the market.

B. If Sugita's beta is 1.18 and the risk-free rate is 4 percent, what would be an expected return for an investor owning Sugita?

(Note: Because the preceding returns are based on monthly data, you will need to annualize the returns to make them comparable with the risk-free rate. For simplicity, you can convert from monthly to yearly returns by multiplying the average monthly returns by 12.)

C. How does Sugita's historical average return compare with the return you should expect based on the Capital Asset Pricing Model and the firm's systematic risk?

A. given the holding period return shown in the table, the average monthly return for the sugita corp. is _____% round to two decimal places

The standard deviation for the sugita corp. is _____ %round to two decimal places

The standard deviation for the market is _______ %round to two decimal places

B. If Sugitas beta is 1.18 and the risk free rate is 4%, the expected return for an investor owning Sugita is _______ round to two decimal places.

The average annual historical return for Sugita is _____% round to two decimal places

C. How does Sugitas historical average return compare with the return you should expect based on the capital asset pricing model and the firms systematic risk (select from the drop down menu)

Sugitals historical average return is A) LESS THAN OR B) GREATER THAN the return based on the capital asset pricing model and the firms systematic risk.

(Related to Checkpoint 8.3) (CAPM and expected returns) a. Given the following holding-period returns, , compute the average returns and the standard Data table return for a to annualiz ly to yearly ct based on