Question: 6. Using the following information for an M2 Group Limited share, calculate their expected return and standard deviation. State Probability Return Boom 20% 40% Normal

6. Using the following information for an M2 Group Limited share, calculate their expected return and standard deviation. State Probability Return Boom 20% 40% Normal 60% 15% Recession 20% (20%) 

7. You are considering investing in a portfolio consisting of 40% Electric General and 60% Buckstar. If the expected rate of return on Electric General is 16% and the expected return on Buckstar is 9%, what is the expected return on the portfolio? 

8. The expected return on MSFT next year is 12% with a standard deviation of 20%. The expected return on AAPL next year is 24% with a standard deviation of 30%. If James makes equal investments in MSFT and AAPL, what is the expected return on his portfolio? 

9. If you hold a portfolio made up of the following shares: Investment Value Beta Share A $2,000 1.5 Share B $5,000 1.2 Share C $3,000 .8 What is the beta of the portfolio?

10. You hold a portfolio with the following securities: Percent Security of Portfolio Beta Return X Corporation 20% 1.35 14% Y Corporation 35% .95 10% Z Corporation 45% .75 8% Compute the expected return and beta for the portfolio. 

9. CSG Limited's ordinary shares have a beta of 1.5. If the expected risk-free return is 2% and the expected return on the market is 14%, what is the expected return on the shares using CAPM? 

10. The Elvis Alive Corporation, makers of Elvis memorabilia, has a beta of 2.35. The return on the market portfolio is 12%, and the risk-free rate is 2.5%. According to CAPM, what is the risk premium on a share with a beta of 1.0?

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