You are managing a mutual fund with the following stocks: What is the beta for this mutual fund (i.e. what is the portfolio beta)? answer format: show your answer to 1 decimal place. Your Answer: You purchased a stock at a price of $23. A year later the stock is worth $29, and during the year it paid $3.0 in dividends. What was the rate of return you earned on this investment? Show your answer in percent (but without the percent sign), and to one decimal place. E.g. 4.67% snould be inputted as 4.7 Your Answer: Answer For markets to be in equilibrium, that is, for there to be no strong pressure for prices to depart from their current levels, The expected rate of return must be equal to the required rate of return. The past realized rate of return must be equal to the expected future rate of return. The required rate of return must equal the past realized rate of return. All three of the above statements must hold for equilibrium to exist. Which is the best measure of risk for a single asset held in isolation, and which is the best measure for an asset held in a diversified portfolio? Variance; correlation coefficient. Standard deviation; correlation coefficient. Beta; variance. Standard deviation; beta. Beta; beta Which of the following statements is CORRECT? Beta is measured by the slope of the security market line. If the risk-free rate rises, then the market risk premium must also rise. If a company's beta is halved, then its required return will also be halved. If a company's beta doubles, then its required return will also double. The slope of the security market line is equal to the market risk premium. The risk-free rate is 5% and the market risk premium is 4%. If stock A has a beta of -1.0 , what is the stock's required rate of return? answer format: show your answer in percent (without the \% sign) and to 1 decimal place. For example, 12.56 should be shown as 12.6 Your Answer: Answer For the coming year you have determined that the following possibilities are most likely for stock A: What is the expected return for stock A ? answer format: show your answer in percent (without the \% sign) and to 1 decimal place. For example, 12.56 should be shown as 12.6 Your Answer: Answer For the coming year you have determined that the following possibilities are most likely for stock A: What is the standard deviation for stock A ? answer format: show your answer in percent (without the % sign) and to 1 decimal place. For eample, 12.56 should be shown as 12.6 Your Answer: Stock A has a beta of 1.5 , the risk-free rate is 4% and the return on the market is 9%. If inflation changes by 2%, by how much will the required return on Stock A change? (i.e. required return after change - required return before the change) answer format: show your answer in percent (without the \% sign) and to 1 decimal place. For example, 12.56 should be shown as 12.6 Your Answer: Answer The risk-free rate is 4% and the market risk premium is 5%. What is the required return on a portfolio of stocks A and B given the information below: answer format: show your answer in percent (without the \% sign) and to 1 decimal place. For example, 12.56 should be shown as 12.6 Your Answer: Answer Stock A has a beta of 1 , the risk-free rate is 4% and the return on the market is 9%. If the market risk premium changes by 8%, by how much will the required return on Stock A change? (i.e. required return after change - required return before the change) answer format: show your answer in percent (without the \% sign) and to 1 decimal place. For example, 12.56 should be shown as 12.6 Your
