3 9.09 points Problem 7-18 (Algo) Consider the following information: Expected Portfolio Return Beta Risk-free 11% Market 16.0 0 1.0 eBook A 12.0 0.7 Print Required: a. Calculate the expected return of portfolio A with a beta of 0.7. (Round your answer to 2 decimal places.) Expected return _ % References b. What is the alpha of portfolio A. (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Alpha % c. If the simple CAPM is valid, is the above situation possible? Yes No 5 Problem 7-10 (Algo) 9.09 points Skipped Required: The market price of a security is $62. Its expected rate of return is 11%. The risk-free rate is 6%, and the market risk premium is 7%. What will the market price of the security be if its beta doubles (and all other variables remain unchanged)? Assume the stock is expected to pay a constant dividend in perpetuity. (Round your answer to 2 decimal places.) Market price eBook Print References