Question
You have observed the following returns over time: Year Stock X Stock Y Market 2011 13 % 12 % 12 % 2012 17 6 10
You have observed the following returns over time: Year Stock X Stock Y Market 2011 13 % 12 % 12 % 2012 17 6 10 2013 -14 -7 -13 2014 2 2 1 2015 19 8 14 Assume that the risk-free rate is 5% and the market risk premium is 6%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. Open spreadsheet What is the beta of Stock X? Do not round intermediate calculations. Round your answer to two decimal places. fill in the blank 2 What is the beta of Stock Y? Do not round intermediate calculations. Round your answer to two decimal places. fill in the blank 3 What is the required rate of return on Stock X? Do not round intermediate calculations. Round your answer to one decimal place. fill in the blank 4 % What is the required rate of return on Stock Y? Do not round intermediate calculations. Round your answer to one decimal place. fill in the blank 5 % What is the required rate of return on a portfolio consisting of 80% of Stock X and 20% of Stock Y? Do not round intermediate calculations. Round your answer to one decimal place. fill in the blank 6 %
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