# Question

Using the data from Problem 5, assume the model is now an Industry Index Model where I1 = Im and that I2 is now an industry index. Assuming that firms A and B are in the same industry, calculate the covariance of returns.

In Problem 5

In Problem 5

## Answer to relevant Questions

Repeat Problem 6, assuming now that firms B and C are in the same industry. Problem 6 Using the data from Problem 5, assume the model is now an Industry Index Model where I1 = Im and that I2 is now an industry index. ...Given the following data What is the optimum portfolio assuming no short sales if RF = 5% and p = 0.5? Consider the following investments. Which is preferred if U(W) = W - 0.05W2? Assume that you expect that the average return on a security in various markets is as shown in the following table. Assume further that the historical correlation coefficients shown in Table 12.1 are a reasonable estimate of ...Consider the CAPM line shown below. What is the excess return of the market over the risk-free rate? What is the risk-free rate?Post your question

0