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PART ONE You are provided with the following data for Kasama Ltd and Choma Ltd. KASAMA LTD Boom Normal Recession Year 2020 2021 2020 2021 2020 2021 End of Year Price (K) 20 28 20 25 20 23 Annual Dividend (K) 4 2 2.5 3 4 2 Annual Cost (K) 3 5 1.5 3.6 5 2.6 Probability 0.3 0.45 0.25 CHOMA LTD Boom Normal Recession Year 2020 2021 2020 2021 2020 2021 End of Year Price (K) 16 18 16 20 16 20 Annual Dividend (K) 0.5 0.88 0.5 0.8 0.5 1.6 Annual Cost (K) 1.5 0.64 1.3 1.92 2 2.4 Probability 0.3 0.45 0.25 The Government Bond rates is 5%, construct the Security Market Line clearly showing the above two stocks as well as the Risk Free Rate. 

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PART ONE You are provided with the following data for Kasama Ltd and Choma Ltd. KASAMA LTD Boom Normal Recession Year 2020 2021 2020 2021 2020 2021 End of Year Price (K) 20 28 20 25 20 23 Annual Dividend (K) 4 2 2.5 3 4 2 Annual Cost (K) Probability 3 5 1.5 3.6 5 2.6 0.3 0.45 0.25 CHOMA LTD Boom Normal Recession Year 2020 2021 2020 2021 2020 2021 End of Year Price (K) 16 18 16 20 16 20 Annual Dividend (K) 0.5 0.88 0.5 0.8 0.5 1.6 Annual Cost (K) 1.5 0.64 1.3 1.92 2 2.4 Probability 0.3 0.45 0.25 The Government Bond rates is 5%, construct the Security Market Line clearly showing the above two stocks as well as the Risk Free Rate. PART ONE You are provided with the following data for Kasama Ltd and Choma Ltd. KASAMA LTD Boom Normal Recession Year 2020 2021 2020 2021 2020 2021 End of Year Price (K) 20 28 20 25 20 23 Annual Dividend (K) 4 2 2.5 3 4 2 Annual Cost (K) Probability 3 5 1.5 3.6 5 2.6 0.3 0.45 0.25 CHOMA LTD Boom Normal Recession Year 2020 2021 2020 2021 2020 2021 End of Year Price (K) 16 18 16 20 16 20 Annual Dividend (K) 0.5 0.88 0.5 0.8 0.5 1.6 Annual Cost (K) 1.5 0.64 1.3 1.92 2 2.4 Probability 0.3 0.45 0.25 The Government Bond rates is 5%, construct the Security Market Line clearly showing the above two stocks as well as the Risk Free Rate.