Assume that the covariance between IBM and the market is 16.07 and that the variance of the market portfolio is 27.83. The E (R_m)= 5.27%

a) Find ß_IBM

b) If the risk-free rate is 3.98% find E (R_IBM)

c) Find the amount of systematic risk in IBM

d) If the variance if IBM is 33.8724, find the R² of IBM

e) Interpret you result in part d

Answer rating: 100% (QA)

a Beta measures the sensitivity of an assets return to the return of the market It is calculated as the covariance of the assets return with the marke... View the full answer