Question: Consider the following table, I'm having problem with part C. Please help. Consider the following table, which gives a security analyst's expected return on two
Consider the following table,
I'm having problem with part C. Please help.

Consider the following table, which gives a security analyst's expected return on two stocks for two particular market returns: Market Return 5% 20 Aggressive Stock Defensive Stock 5.3% 35% 26 a. What are the betas of the two stocks? (Round your answers to 2 decimal places.) Beta A 1.88 Beta D 0.39 b. What is the expected rate of return on each stock if the market return is equally likely to be 8% or 20%? (Round your answers to 2 decimal places.) Rate of return on A 14.75 % Rate of return on D 765 % c. If the T-bill rate is 8%, and the market return is equally likely to be 8% or 20%, what are the alphas of the two stocks? (Negative values should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.) Alpha A Alpha D 7B5% 7.85 %
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