10. Problem 8.13 (CAPM, Portfolio Risk and Return) 1.6 eBook Problem Walkthrough Consider the following information for stocks A, B, and C. The retums on the three stocks are positively correlated, but they are not perfectly created. That is each of the correlation contas been 0 and 1.) Stock Expected Hoturn Standard Deviation Beta 8.75 164 0.9 9.50 16 12 10.50 16 Pund has one-third of its funds invested in each of the three stocks. The nike free rate is 6.5% and the market is in equilibrium (That required returnsqual expected returns.) a. What is the market rak premium (Round your answer to one otomat place b. What is the beta of Fund P7 Do not round intermediate calculations. Round your awer to two decimal places c. What is the requred return of Fund P? Do not round intermediate calculations. Hound your answer to two decimal places d. What would you expect the standard deviation of Fund P to be? 1. Less than 16 11. Greater than 16% III. Equal to 16% Salt