Risk and Return

Question$-1$ Is the following statement true of false according to Capital Asset Pricing Model

$($CAPM$).$ Please explain your answers

"Stock with a beta of zero will offer a zero rate of return."

Question$-2$ If CAPM is valid, is the following scenario possible? Please explain your answers.

Question$-3$ Using the following table to answer parts a toc.

a$)$ What are the expected rates of return for Stocks $x$ and $Y?$

b$)$ What are the standard deviations of returns on Stocks $x$ and $Y?$

c$)$ Assume you invest $$10,000$ in Stock $x$ and $$5,000$ in Stock $Y,$ what is the expected return on

your portfolio?

Question$-4$ You decide to invest in one of the $4$ stocks: A$,$ B$,$ C and D$.$ Based on the historical prices

presented in the following table, please answer parts a$)$ and b$).$

a$)$ Calculate the return and risk $($standard deviation$)$ of each stock.

b$)$ Based on your calculation, which stock would you pick?