4. Suppose that you are an entrepreneur, and you want to invest in the tower project...

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4. Suppose that you are an entrepreneur, and you want to invest in the tower project with an amount of $100,000, as the following table shows the returns expected to be obtained in this project. We also have a risk-free return of 5.5%, the expected market return of 16.5%, the expected standard deviation of the market return of 15%, the possible correlation between the project return and the market return of 0.60. Based on this information, answer the following questions Success Mosly Fail Possibility 0.35 0.25 0.40 return 0.35 0.195 -0.15 A) Calculate the standard deviation for this project B) Calculate the beta for the project C) Calculate the return required by the entrepreneur to invest in this project 4. Suppose that you are an entrepreneur, and you want to invest in the tower project with an amount of $100,000, as the following table shows the returns expected to be obtained in this project. We also have a risk-free return of 5.5%, the expected market return of 16.5%, the expected standard deviation of the market return of 15%, the possible correlation between the project return and the market return of 0.60. Based on this information, answer the following questions Success Mosly Fail Possibility 0.35 0.25 0.40 return 0.35 0.195 -0.15 A) Calculate the standard deviation for this project B) Calculate the beta for the project C) Calculate the return required by the entrepreneur to invest in this project

Answer rating: 100% (QA)

A To calculate the standard deviation of the project we can use the following formula project Psuccess returnsuccess Ereturn2 Pmostly returnmostly Ere... View the full answer