FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose the risk free rate is 4.4 percent and the market portfolio has an expected return of 10.9 percent. The market portfolio has a variance

Suppose the risk free rate is 4.4 percent and the market portfolio has an expected return of 10.9 percent. The market portfolio has a variance of .0391. Portfolio Z has a correlation coefficient with the market of .31 and a variance of .3407. According to the capital asset pricing model, what is the expected return on Portfolio Z?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Personal Finance

Personal Finance

Authors: Thomas Garman, Raymond Forgue

12th edition

9781305176409, 1133595839, 1305176405, 978-1133595830

More Books

Students also viewed these Finance questions

Question

★★★★★
(b) (c) (d) (e) (f) Explain how assets and liabilities are recognized in financial statement. Differentiate between capital expenditures and revenue expenditures, giving an example in each case....

Answered: 1 week ago

Question

★★★★★
I need your help with this: Can you please quote from the attached chapters / resource if possible? Corporations often use different costs of capital for different operating divisions. Using an...

Answered: 1 week ago

Question

★★★★★
Need help with the 70 multiple choice questions for final exam - if you can, please provide explanation for harder questions. A s ae o . s h r d n. . Surname: ______________________ Q1 Given names:...

Answered: 1 week ago

Question

★★★★★
a) What would be the third term? What would be the next to last term? What would be the last term? b) What would be the second term? What would be the next to last term? What would be the last term?...

Answered: 1 week ago

Question

★★★★★
If an investor owns more than 50% of an investee, how is this treated on the investors financial statements?

Answered: 1 week ago

Question

★★★★★
Dr. Susan Fleishman is Medical Director of the Venice Family Clinic in Southern California (VFC). She is concerned about the long wait times of patients visiting the clinic and would like to improve...

Answered: 1 week ago

Question

★★★★★
3. Give short, clear directions before, not during, transitions.

Answered: 1 week ago

Question

★★★★★
The New England Soap Company is considering adding some processing equipment to the plant to aid in the removal of impurities from some raw materials. By adding the processing equipment, the firm can...

Answered: 1 week ago

Question

★★★★★
3 A 3.9 percent corporate coupon bond is callable in 10 years for a call premium of one year of coupon payments. Assuming a par value of $1,000, what is the price paid to the bondholder if the issuer...

Answered: 1 week ago

Question

★★★★★
7. Which of the following is closest the z-score to the 90th percentile of the standard normal distribution? (a) - 1.28 (b) 2.36 (c) 1.28 (d) -1.34 O a Ob O c ad

Answered: 1 week ago

Question

★★★★★
Pablo, Dirk and Franz run the only bar in town. Pablo wants to sell as many drinks as possible without losing money. Dirk wants the bar to bring in as much revenue as possible. Franz wants to make...

Answered: 1 week ago

Question

★★★★★
Continue with the gamma model of Exercise 5-2. (a) Show that \(\partial Q_{N}(\boldsymbol{\beta}) / \partial \boldsymbol{\beta}=\boldsymbol{N}^{-1} \sum_{i} 2\left[\left(y_{i}-\exp...

Answered: 1 week ago

Question

★★★★★
A carpet cleaning firm uses an average of 20 gallons of cleaning fluid a day. Usage tends to be normally distributed with a standard deviation of 2 gallons per day. Lead time is 4 days, and the...

Answered: 1 week ago

Question

★★★★★
For the data in Table 12.1, confirm that the Pearson statistic in equation (12.3) is 41.98 . Table 12.1 (12.3) Count Observed (j) (nj) Fitted Counts Using the Poisson Distribution (np;) 01234 6,996...

Answered: 1 week ago

Question

★★★★★
If demand for an item is 10 per month, the cost of placing an order is \($15\), and the cost of holding one item in inventory for 1 year is \($25\), what is the EOQ?

Answered: 1 week ago

Question

★★★★★
Consider the following cash flows: Year 0 1 2 3 4 5 6 Cash Flow -$5,000 $1,200 $2,400 $1,600 $1,600 $1,400 $1,200 A. Payback The company requires all projects to payback within 3 years. Calculate the...

Answered: 1 week ago

Question

★★★★★
The first law of thermodynamics is sometimes whimsically stated as, You cant get something for nothing, and the second law as, You cant even break even. Explain how these statements could be...

Answered: 1 week ago

Question

★★★★★
5.1 How do we get buy-in to appraisal during the design stage?

Answered: 1 week ago

Question

★★★★★
5.2 Who should contribute to the appraisal of an individual employee? Is there a role for self-assessment if so, how much reliance should we place on it?

Answered: 1 week ago

Question

★★★★★
6.4 Critically evaluate the systems for making promotion decisions and for identifying high potential amongst existing staff in either your own organisation or one you are familiar with. What changes...

Answered: 1 week ago

Previous Question Next Question