Question
Your are a finance executive given the job of discussing attractiveness of two acquisition targets. Pick Microsoft and Verizon. 1. Below are the hypothetical average
Your are a finance executive given the job of discussing attractiveness of two acquisition targets. Pick Microsoft and Verizon. 1. Below are the hypothetical average percentage returns for the two companies- Microsoft and Verizon Market 4 6 MSFT 4 2 4 6 2 Verizon 5 3 3 7 1 8 6 4 7 NOON WAON vw 4 1 4 2 6 - 7. Does portfolio of the two companies show lower standard deviation than individual stock company standard deviations? 8. Calculate the expected return using CAPM for each company. 9. What is the beta of the portfolio and 10. What is the expected return on the portfolio?
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