TRUE OR FALSE: If Stock A is positively correlated with Stock B and Stock B is positively correlated with Stock C, then Stock A must be positively correlated with Stock C.

Ford Inc. has a Beta of 1.25. Next year the risk-free rate will be 1%, the market will have a return of -5%, and Ford will have a return of -2%. Ford's alpha is __________%.

You are analyzing a 3 asset portfolio. You are given the following information about Stocks A, B and C (Hint - these numbers are EXACTLY the same as we did in class): Return A Return B Return C 5% 10% 15% St. Dev. St. Dev. 6% 9% St. Dev. 21% Corr (A,B) 0.15 Corr (B,C) 0.30 | (AC) (0.20) The risk-free rate is 4%. ROUND YOUR ANSWERS TO THE NEAREST TENTH OF A PERCENT - EXAMPLE 5.1 for an answer of 5.08%