Question: Need assistance understanding the calculation on the problem below. Part 1. Dallas Star Inc. 's stock has a 40% chance of producing a 5% return,

Need assistance understanding the calculation on the problem below.

Part 1. Dallas Star Inc. 's stock has a 40% chance of producing a 5% return, and a 60% chance of producing a 15% return. What is the firm's expected rate of return? What is the firm's Standard Deviation? What is the firm's Coefficient of Variation?

Part 2. Calculate the required rate of return for Dallas star inc assuming that (1) the nominal risk-free rate is 5%, (2) expected market return is 10% and (3) the firm has a beta of 2. Hint you need to find out market risk premium first.

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