Question: Please I need the anwsers with all steps clearly please Consider the following information on Stocks I and II: Rate of Return If State Occurs
Consider the following information on Stocks I and II: Rate of Return If State Occurs State of Economy Recession Normal Probability of State of Economy .30 .40 Stockt .08 .19 Stock II -18 .14 Irrational exuberance 30 .13 .29 a. The market risk premium is 8 percent, and the risk-free rate is 5 percent. What is the beta of each stock? b. Which stock has the most sytematic risk? What is the standard deviation of each stock? d. Which one has the most unsytematic risk? Which stock is riskier? C. e
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