introduction to finance

Question 3 [18 MARKS] a) Based on CAPM, total risk is made up of both systematic risk (non-diversifiable risk) and unsystematic risk (diversifiable risk). Differentiate between the systematic and unsystematic risk with example. (8 MARKS) b) Kossan Berhad is one of the glove company in Malaysia. Kossan Berhad is evaluating a Security XYZ. The information of the Security XYZ is as follow: (10 MARKS) Rate of return 0.30 0.15 0.20 0.15 Probability 0.20 0.30 0.40 0.50 Calculate standard deviation of Security B. Question 3 [18 MARKS] a) Based on CAPM, total risk is made up of both systematic risk (non-diversifiable risk) and unsystematic risk (diversifiable risk). Differentiate between the systematic and unsystematic risk with example. (8 MARKS) b) Kossan Berhad is one of the glove company in Malaysia. Kossan Berhad is evaluating a Security XYZ. The information of the Security XYZ is as follow: (10 MARKS) Rate of return 0.30 0.15 0.20 0.15 Probability 0.20 0.30 0.40 0.50 Calculate standard deviation of Security B