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Systematic Risk and Expected Rate of Return : The following table, contains beta coefficient estimates for six firms. Calculate the expected increase in the value

Systematic Risk and Expected Rate of Return : The following table, contains beta coefficient estimates for six firms. Calculate the expected increase in the value of each firm's shares if the market portfolio were to increase by 10 percent. Perform the same calculation where the market drops by 10 percent. Which set of firms has the most variable or volatile stock returns?

Company Mirosoft Money Central (MSN.com
Computers and Software
Apple Inc. (AAPL) 2.28
Dell Inc. (DELL) 1.53
Hewlett Packard(HPQ) 1.29
Utilities
American ELectric Power Co (AEP) 0.73
Duke Energy Corp. (DUK) 0.52
Centerpoint Energy (CNP) 0.83

Input the expected increase in the value of each firm's shares if the market portfolio were to increase by 10%.(Round each answer to two decimal places.)

Company

Microsoft MoneyMicrosoft Money

Central left parenthesis MSN.com right parenthesisCentral (MSN.com)

Beta Estimate

Expected Increase

Computers and Software

Apple Inc. (AAPL)

2.28

_______%

Dell Inc. (DELL)

1.53

_______%

Hewlett Packard (HPQ)

1.29

________%

Utilities

American Electric Power Co. (AEP)

0.73

______%

Duke Energy Corp. (DUK)

0.52

______%

Centerpoint Energy (CNP)

0.83

_______%

Input the expected decrease in the value of each firm's shares if the market portfolio were to decrease by 10%.(Round each answer to two decimal places.)

Company

Microsoft MoneyMicrosoft Money

Central left parenthesis MSN.com right parenthesisCentral (MSN.com)

Beta Estimate

Expected Decrease

Computers and Software

Apple Inc. (AAPL)

2.28

________%

Dell Inc. (DELL)

1.53

________%

Hewlett Packard (HPQ)

1.29

________%

Utilities

American Electric Power Co. (AEP)

0.73

_________%

Duke Energy Corp. (DUK)

0.52

________%

Centerpoint Energy (CNP)

0.83

________%

Which set of firms has the most variable or volatile stock returns?(Select the best choice below.)

A. Utilities

B. Computer and Software firms

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