Risk and Return Questions: 1. The prices for the National Gasworks Corporation for the second quarter of 2012 are given below. The price of the stock on April 1, 2012 was $130. Find the holding period return for an investor who purchased the stock on April 1, 2012 and sold it the last day of June 2012. Month EndPrice April$125.00 May138.50 June132.75 2. The common stocks of Company L. and Comp. B . are to be combined in a portfolio. E (RL) = %5 E(RB)= %10 L= %12 B= %20 WA=WB=%50 Find the expected return and standart deviation levels of this portfolio if the correlation between returns is r A,B =1 r A,B=0.5 rA,B =0 3. An investor currently holds the following portfolio: Amount Invested 8,000 shares of Stock A$16,000Beta = 1.3 15,000 shares of Stock B$48,000Beta = 1.8 25,000 shares of Stock C$96,000Beta = 2.2 If the risk-free rate of return is 2% and the market risk premium is 7%, then the required return on the portfolio is ??? 4. Use the following data: Market risk premium = 10% Risk free rate = 2% Beta of XYZ stock = 1.6 Beta of PDQ stock = 2.4 Investment in XYZ stock = $15,000 Investment in PDQ stock = $60,000 You have no assets other than your investments in XYZ and PDQ stock. What is the expected return of your portfolio? Show all work. 5. Assume that you have $100,000 invested in a stock that is returning 14%, $150,000 invested in a stock that is returning 18%, and $200,000 invested in a stock that is returning 15%. What is the expected return of your portfolio? 6. You are considering investing in a project with the following possible outcomes: Probability ofInvestment StatesOccurrenceReturns State 1: Economic boom18%20% State 2: Economic growth42%16% State 3: Economic decline30%3% State 4: Depression10%-25% Calculate the expected rate of return and standard deviation of returns for this investment, respectively. 7. Marble Corp. has a beta of 2.5 and a standard deviation of returns of 20%. The return on the market portfolio is 15% and the risk free rate is 4%. According to CAPM, what is the required rate of return on Collectible's stock?

!!! Please write the formulas first and then solve the questions. Thank you :)