Suppose that the Treasury bill rate is 6% rather than 2%. Assume that the expected return on the market stays at 10%. Use the betas in Table 8.2.
a. Calculate the expected return from Pfizer.
b. Find the highest expected return that is offered by one of these stocks.
c. Find the lowest expected return that is offered by one of these stocks.
d. Would Ford offer a higher or lower expected return if the interest rate were 6% rather than 2%? Assume that the expected market return stays at 10%.
e. Would Walmart offer a higher or lower expected return if the interest rate were 8%?
Table 8.2

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Expected Return Beta (B) 1.78 1.54 1.53 Dow Chemical 14.5 12.8 12.7 8.9 8.7 7.6 7.3 6.6 4.9 4.8 Bank of America Exxon Mobil Newmont Mining