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

Question

1 Approved Answer

Suppose the standard deviation of the market return is 15%. a. What is the standard deviation of returns on a well-diversified portfolio with a beta

Suppose the standard deviation of the market return is 15%.

a. What is the standard deviation of returns on a well-diversified portfolio with a beta of 1.2? (Enter your answer as a percent rounded to the nearest whole number.)

Standard deviation %

b. What is the standard deviation of returns on a well-diversified portfolio with a beta of 0? (Enter your answer as a percent rounded to the nearest whole number.)

Standard deviation %

c. A well-diversified portfolio has a standard deviation of 8%. What is its beta? (Round your answer to 2 decimal places.)

Beta

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

Step: 3

blur-text-image

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

Numerical Methods In Finance

Numerical Methods In Finance

Authors: René Carmona, Pierre Del Moral, Peng Hu, Nadia Oudjane

2012th Edition

3642257453, 978-3642257452

More Books

Students also viewed these Finance questions

Question

★★★★★
The unadjusted trial balance of Fashion Centre Ltd. contained the following accounts at November 30, the company's fiscal year end: Additional information and adjustment data: 1. The 12-month...

Answered: 1 week ago

Question

★★★★★
Why is it good practice to explain, when applicable, how replying to a request could benefit the reader? [LO-1]

Answered: 1 week ago

Question

★★★★★
Compute a simple price index for each of the four items. Use 2000 as the baseperiod.

Answered: 1 week ago

Question

★★★★★
Determine the annual interest rate that is needed for the following investments to accumulate to $50,000. 1. $10,414 for 20 years, interest compounded semiannually. 2. $7,102 for 10 years, interest...

Answered: 1 week ago

Question

★★★★★
Suppose the standard deviation of the market return is 15%. a. What is the standard deviation of returns on a well-diversified portfolio with a beta of 1.2? (Enter your answer as a percent rounded to...

Answered: 1 week ago

Question

★★★★★
What do governments do when there is a supply shock to the economy? what fiscal or monetary policy works best in this scenario?

Answered: 1 week ago

Question

★★★★★
Baldwin Inc. sells a wide range of drums, bins, boxes and other containers that are used in the chemical industry. One of the companys products is a heavy duty corrosion-resistant metal drum, called...

Answered: 1 week ago

Question

★★★★★
Help Save & Exit Exercise 2.10 (Algo) Preparing a statement of owner's equity and a balance sheet. LO 2-5 Check my w At the beginning of September, Helen Rojas started Rojas Wealth Management...

Answered: 1 week ago

Question

★★★★★
A big - box retailer took photos of customers as they walked in . The retailer then used the photos for a TV commercial. In the IRAC process, where would the law on misappropriation be stated?

Answered: 1 week ago

Question

★★★★★
Corey is buying a used trailer for his snowmobiles. A local dealer offers 4.46% interest compounded monthly for six months on used equipment. If the trailer Cory likes costs $5500.00, using an...

Answered: 1 week ago

Question

★★★★★
In Section 1.3 we saw that the autonomous differential equation m- dv dt = mg - kv, where k is a positive constant and g is the acceleration due to gravity, is a model for the velocity v of a body of...

Answered: 1 week ago

Question

★★★★★
5. Keep a log of how you listen with technology. Is it easieror more difficult for you to select, attend, remember, understand, and respond? Compare your experiences with friends. Do some of your...

Answered: 1 week ago

Question

★★★★★
A Should you tell Jamie the truth? Is it ethical to hide your true feelings from a friend? What might happen if you just say, Im embarrassed to say that Im feeling a bit jealous. Im feeling bummed...

Answered: 1 week ago

Question

★★★★★
B What are Jamies ethical responsibilities here? Has your friend been listening to you? Should Jamie have been able to sense your sensitivity about the situation from the way youve responded?

Answered: 1 week ago

Previous Question Next Question