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You have the below information about the expected returns of Palantir Technologies and Valar Ventures for the coming year, which both heavily depend on the
You have the below information about the expected returns of Palantir Technologies and Valar Ventures for the coming year, which both heavily depend on the state of the economy: Economic Palantir Valar Probability State Technologies Ventures Boom 0.20 22.00% 39.00% Normal 0.42 14.00% 22.00% Recession 0.38 0.00% -1.00% A) What is the expected return of Palantir Technologies in the coming year? (Round your answer to two decimal places) % B) What is the expected return of Valar Ventures in the coming year? (Round your answer to two decimal places) % C) What is the expected standard deviation of Palantir Technologies' return in the coming year? (Round your answer to two decimal places) % D) What is the expected standard deviation of Valar Ventures' return in the coming year? (Round your answer to two decimal places) Suppose that the risk-free rate is 4.70% per annum. In addition, assume that the market portfolio has a required return of 12.80% per annum and a standard deviation of 15.90%. You are attempting to value the shares of Firm QQ. According to the Capital Asset Pricing Model (CAPM), what rate of return per annum should you require as compensation for investing in shares of Firm QQ if... % A) ...those shares have a beta of 0.00? (Round your answer to two decimal places) % B) ...those shares have a beta of 0.55? (Round your answer to two decimal places) % C) ...those shares have a beta of 1.00? (Round your answer to two decimal places) % D) ...those shares have a beta of 1.52? (Round your answer to two decimal places)
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