1. With the returns and probabilities for these 3 possible states listed below, calculate the covariance between the returns of Stock A and Stock B. Please assume that the expected returns of Stock A and Stock B are 0.12and0.16, respectively. (Round your answer to 4 decimal places. For example .1344)

Probability Return(A) Return(B)

Good 0.35 0.30 0.50

OK 0.50 0.10 0.10

Poor 0.15 -0.25 -0.30

2 The risk-free rate of return is currently0.04, while the market risk premium is0.04. If the beta of XYZ, Inc., stock is 1.4, then what is the expected return on XYZ? Round to three decimal places.

3 Amanda purchased a stock one year ago for $28. The stock is now worth $33, andthe total return to Amanda for owning the stock was0.36. What is thedollar amount of dividends that she received for owning the stock during theyear? Round to two decimal places.