Question 1
A mutual fund manager expects her portfolio to earn a rate of return of 9% this year. Her portfolio's beta is 0.8, kf = 4% and E= 11%. Should you invest in her mutual fund?Question 2
A stock has a beta of 1.8. The expected market return is 10.5%. The equilibrium return for the stock is 17.30%. What is the risk-free rate according to the CAPM?Answer 1
NoAnswer 2
2%