You have been provided the following data on the securities of three firms, the market portfolio, and the risk-free asset:

a. Fill in the missing values in the table. (Leave no cells blank - be certain to enter 0 wherever required. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

Security Expected Return Standard Deviation Correlation* Beta

Firm A. .101 .40 .76 ?

Firm B. .149 ? .59 1.31

Firm C. .169 .56 .44 ?

The market portfolio .12 .20 ? ?

The risk-free asset .05 ? ? ?

*With the market portfolio.

b-1. According to the CAPM, what is theexpected return of Firm A's stock? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Expected return_______?

b-2. What is your investment recommendation for someone with a well-diversified portfolio?

• Buy
• Sell

b-3. According to the CAPM, what is the expected return of Firm B's stock? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Expected return__________?

b-4. What is your investment recommendation for someone with a well-diversified portfolio?

• Buy
• Sell

b-5. According to the CAPM, what is theexpected return of Firm C's stock? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Expected return__________?

b-6. What is your investment recommendation for someone with a well-diversified portfolio?

• Buy
• Sell