Question: please help answer Chapter 6 Case Expected Returns Probability Distributions: Probability 03 04 0.3 IM 14.00 9.00 18.00 J 18.00 5.00 12.00 Market 16.00 7.00

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Chapter 6 Case Expected Returns Probability Distributions: Probability 03 04 0.3 IM 14.00 9.00 18.00 J 18.00 5.00 12.00 Market 16.00 7.00 16.00 2 Find the following for cach: IM Market Expected return Standard deviation 6. Find the Beta for cach stock d. Using your betas and the following information find the required rate of return on these stocks Risk-free rato, RF 3.00 Market risk premium, RPM 9.00 (Market risk. Risk Free rate) Your portfolio consists of: Beta Stock P 5,000,000 1.25 Stock R 8,000,000 0.75 Stock S 4,000,000 -2.5 Stock T 3,000,000 2 If the market required rate of return is 13% and the risk free rate is 5% what is the funds required rate of return?

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