please answer questions 1-3

Homework 2 Due on October 22, 2019 1. Suppose you bought 100 shares of stock at an initial price of $37 per share. The stock paid a dividend of $0.28 per share during the following year, and the share price at the end of the year was $41. (1) What is the capital gains yield? (2) What is the dividend yield? (3) What is the total rate of return (holding period return) on the investment? 2. Use the following information on stock D to calculate the expected return and the standard deviation of returns. Security Return if State Occurs -8% Probability of State of State of Economy Economy Recession 0.25 Normal 0.5 Boom 0.25 13% 23% 3. Use the following information to calculate the expected return and standard deviation of a portfolio that is 50% invested in Roses Inc., and 50% invested in Tulip Co. Roses Inc. Tulip Co. Expected return, E(R) 14% 10% Standard deviation, o 42% 31% Correlation