Question
The following table shows estimates of the risk of two well-known Canadian stocks Toronto Dominion Bank 25 .25 .82 .18 Canadian Pacific 28 .30 1.04
The following table shows estimates of the risk of two well-known Canadian stocks
Toronto Dominion Bank 25 .25 .82 .18
Canadian Pacific 28 .30 1.04 .20
What is the variance of Toronto Dominion? What is the specific variance?
What is the confidence interval on Canadian Pacific's beta?
If the CAPM is correct, what is the expected return on Toronto Dominion? Assume a
risk-free interest rate of 5% and an expected market return of 12%.
Suppose that next year the market provides a zero return. Knowing this, what return
would you expect from Toronto Dominion?
Please, help me to solve this problem. Thanks. God Bless.
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