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You are given a number of portfolios with their retums and risk. (a) Plot the feasible or attainable set represented by these data on a
You are given a number of portfolios with their retums and risk. (a) Plot the feasible or attainable set represented by these data on a set of portfolio risk on x-axis and portfolio return ony-axis.(5 marks) (c) Draw the efficient frontier on the graph in 7 (a). (2 marks) (d) Which portfolio lies on the efficient frontier and explain the reason why is these portfolios dominate the others in the feasible of attainable set?( 3 marks) (c) Given an Abtitrage Pricing Theory (ABT) model with risk free rate of9 percent; sensitivity to factor 1 and 2 are 0.8 and 5 respectively and risk factor 1 and 2 is 0.04 and 0.02 , find the expected retum of the security. (3 marks) (t) ABC company preference share par value is RM100. The shares had just been sold at the price of RM8S. Find the ABC's cost of preference share if the dividend rate is 8 percent, payable every year. (3 marks) (g) Using the Gordon growth model which assumes that dividends grow at a constant rate forevet, compute the value of a stock that pay a dividend of RMI per share next year, if the expected grow wh nate of dividends is 6 percent and the shareholder require a retum of 16 percent from their investment. 4 marks) You are given a number of portfolios with their retums and risk. (a) Plot the feasible or attainable set represented by these data on a set of portfolio risk on x-axis and portfolio return ony-axis.(5 marks) (c) Draw the efficient frontier on the graph in 7 (a). (2 marks) (d) Which portfolio lies on the efficient frontier and explain the reason why is these portfolios dominate the others in the feasible of attainable set?( 3 marks) (c) Given an Abtitrage Pricing Theory (ABT) model with risk free rate of9 percent; sensitivity to factor 1 and 2 are 0.8 and 5 respectively and risk factor 1 and 2 is 0.04 and 0.02 , find the expected retum of the security. (3 marks) (t) ABC company preference share par value is RM100. The shares had just been sold at the price of RM8S. Find the ABC's cost of preference share if the dividend rate is 8 percent, payable every year. (3 marks) (g) Using the Gordon growth model which assumes that dividends grow at a constant rate forevet, compute the value of a stock that pay a dividend of RMI per share next year, if the expected grow wh nate of dividends is 6 percent and the shareholder require a retum of 16 percent from their investment. 4 marks)
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