A) you Are forecasting the returns for General motor (GM)common stock and believe the returns based on the market for the next year are as follows

Market Probability GM returns

Downturn 20% -7%

Normal 50% 9%

Expansion 30% 14%

a) what is the expected return of general motors stock? ___________

b) what is the variance and standard deviation of General Motors stock?

__________ variance

___________ std deviation

B) you are estimating the expected required return of stocks based on the capital access pricing model. You estimate the risk free rate is 1% in the market risk premium 5%.

a) what are the required rates of the following stocks?

Company Beta Required rate

General Motors 1.30 _____________

Starbucks 0.89 _____________

Coca Cola 0.49 _____________

b) what would be the beta of an equally weighted portfolio of the above stocks?

____________

c) what is the required rate of the portfolio from b?

____________

please use excel and elaborate which formula you uses and what you used for the formula to get the answer. thank you in advance!