$1.$ Expected Return A company's current stock price is $$85\mathrm{.}30$ and it is likely to pay a $$4\mathrm{.}30$ dividend next year. Since analysts estimate the company will have a $10\%$ growth rate, what is its expected return?

Multiple Choice

$5\mathrm{.}04\%$

$10\mathrm{.}00\%$

$15\mathrm{.}04\%$

$4\mathrm{.}73\%$

$2.$ Risk Premium If the annual return on the S&P $500$ Index was $10\mathrm{.}30$ percent. The annual T$-$bill yield during the same period was $4\mathrm{.}45$ percent. What was the market risk premium during that year?

Multiple Choice

$14\mathrm{.}75\%$

$10\mathrm{.}30\%$

$4\mathrm{.}45\%$

$5\mathrm{.}85\%$

$3.$ Stock Market Bubble The NASDAQ stock market bubble peaked at $3,800,$ and two and a half years later it had fallen to $2,250.$ What would be the percentage decline?

Multiple Choice

$-40\mathrm{.}79\%$

$-16\mathrm{.}89\%$

$-68\mathrm{.}89\%$

$-59\mathrm{.}21\%$

$4.$ Portfolio Beta You own $$19,000$ of City Steel stock that has a beta of $3\mathrm{.}29.$ You also own $$37,000$ of Rent$-$N$-$Company $($beta $=1\mathrm{.}74)$ and $$20,400$ of Lincoln Corporation $($beta $=-0\mathrm{.}86).$ What is the beta of your portfolio?

Multiple Choice

$1\mathrm{.}43$

$1\mathrm{.}00$

$4\mathrm{.}17$

$4\mathrm{.}92$

$5.$ Expected Return A company's current stock price is $$25\mathrm{.}60$ and it is likely to pay a $$1\mathrm{.}35$ dividend next year. Since analysts estimate the company will have a $14\%$ growth rate, what is its expected return?

Multiple Choice

$14\mathrm{.}00\%$

$1\mathrm{.}54\%$

$5\mathrm{.}27\%$

$19\mathrm{.}27\%$