1)

2)

Quantitative Problem: You are holding a portfolio with the following investments and betas: Stock Dollar investment Beta 1.35 A $300,000 B 100,000 1.70 500,000 0.80 100,000 -0.20 Total investment $1,000,000 The market's required return is 11% and the risk-free rate is 4%. What is the portfolio's required return? Do not round intermediate calculations. Round your answer to three decimal places. % A stock's returns have the following distribution: Demand for the Probability of this Rate of Return If Company's Products Demand Occurring This Demand Occurs Weak 0.1 (48%) Below average 0.2 (15) Average 0.3 13 Above average 0.3 23 Strong 0.1 59 1.0 Assume the risk-free rate is 3%. Calculate the stock's expected return, standard deviation, coefficient of variation, and Sharpe ratio. Do not round intermediate calculations. Round your answers to two decimal places. Stock's expected return: % Standard deviation: % Coefficient of variation: Sharpe ratio