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Stocks A and B have the following probabifity distributions of expected future returns: is *is. Now calculate the coefficient of valstion for stock o. Do

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Stocks A and B have the following probabifity distributions of expected future returns: is *is. Now calculate the coefficient of valstion for stock o. Do not round intermediate calculations. Round your anwwer to two decimul places. If it possible that ment inveutoen might regard stock o as being insw risky than steck A ? 1. If stock, B is more highly corretured with the maket than A, then in might have a iower beta than stock A, and hence be iess risky in a portfolio sense. 11. If stock 8 is les highly cerrelated whin the market than A, then a might have - iower beta than stock A, and hence be lese risky in a portfolle sense. F. If Stock B is less Highly corretated with the market than A, then is might have a higher beta than stock A, and hence be more risky in a pertfolio sense. stock A: Stock a: Calculate the expected rate of return, rB, for StockB(r^A=15.10% ) Do not round intermedate calculations. Round your answer to two decimal places, % Calculate the standard deviation of expected returns, OA, for Stock A(OB=20,87%.) Do not round intermediate calculations. Round your answer to two decima places. % Now calculate the coefficient of variation for Stock B. Do not round intermediate calculotions. Round your answer to two decimal places. Is it possible that most investors might regard Stock B as being less risky than Stock A? 1. If Stock B is more highly correlated with the market than A, then it might have o lower beta than Stock. A, and hence be less risky in a portfolio sense. II. If Stock B is more highly correlated with the market than A, then it might have the same beta as Stock. A, and hence be just as risky in a portfolio sense. 1II. If Stock B is less highly correlated with the market than A, then it might have a lower beta than Stock A, and hence be less risky in a portfolio sense. IV. If Stock B is less highly correlated with the market than A, then it might have o higher beta than Stock A, and hence be more risky in a portfolio sense. V. If Stock. B is more highly correlated with the market than A, then it might have a higher beta than Stock A, and hence be less risky in a portfolio serise: C. Assume the nak-free rate is 1.5%. What are the Sharpe ratios for Stocks A and B? Do not round intermediate calculations, Round your answers to four decimal places. Stock A

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