Question: Solve the following exercises as the unknowns are presented. Question # 1 The PRI Holding Company share has a beta value of 1.2. The risk-free

Solve the following exercises as the unknowns are presented.

Question # 1

The PRI Holding Company share has a beta value of 1.2. The risk-free rate is 4% and the market premium is 3%.

Calculate the expected performance of PRI

Holdings.

Option 1: 7.00%

Option 2: 9.00%

Option 3: 10.00%

Option 4: 8.00%

Question # 2

The share of YYY Holding Company has a beta value of .75, the risk-free rate is 2% and the market premium is 7%

Calculate the expected return of YYY Holdings.

Option 1: 6.02%

Option 2: 8.00%

Option 3: 7.25%

Option 4: 8.50%

Question # 3

The X-Mart Company stock has a beta value of .75. The risk-free rate is 2% and the premium of the earned is 7%

Calculate the expected performance of X-Mart

Company.

Option 1: 5.03%

Option 2: 10.00%

Option 3: 7 .25%

Option 4: 11.00%

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