Question: 15. Based on the following probability distribution, what is the security's expected return? (to points) State Probability FraP+RP,F -50% 0.1 0.1 0.8 to 10.0 3
15. Based on the following probability distribution, what is the security's expected return? (to points) State Probability FraP+RP,F -50% 0.1 0.1 0.8 to 10.0 3 30.0 -5.0 + 0.1 My 2 16. Marvin has investments with the following characteristics in his portfolio: (1o points) Expected Amount Investment Return, Invested $10,000 50,000 40,000 40% 16 10 EFG QRP What is the expected return of Marvin's portfolio of investments, f,? 17. Suppose risk free rate is 5%, return on market is 11%, and return on stock B is 14%. Calculate Stock B's beta, ? (10 points) a. If Stock B's beta were 1.5, what would be B's new required rate of return? (5 points)
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