This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Stock A has an expected return of 12% and a standard deviation of 23%. Stock B has an expected ... (Read 59 times)

hannahmadyronde

  • Full Member
  • ***
  • Posts: 134
on: Aug 7, 2023
Stock A has an expected return of 12% and a standard deviation of 23%. Stock B has an expected return of 16% and a standard deviation of 31%. The risk-free rate is 6% and the market risk premium, rM– rRF, is 7%. Assume that the market is in equilibrium. Portfolio AB has 50% invested in Stock A and 50% invested in Stock B. The returns of Stock A and Stock B are independent of one another; that is, the correlation coefficient between them is zero. Which of the following statements is correct?

◦

Since the two stocks have zero correlation, Portfolio AB is riskless.


◦

Stock A’s beta is 0.8571.


◦

Stock B’s beta is 1.2510.


◦

Portfolio AB’s required return is 13%.

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
Buy Test-Bank


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by hannahmadyronde on Aug 7, 2023

Mynameisrandom

  • Full Member
  • ***
  • Posts: 178
Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
Answer Preview
Only 50% of students answer this correctly


hannahmadyronde

  • Member
  • Posts: 134
Reply 2 on: Aug 7, 2023
Great answer, keep it coming :)

shailee

  • Member
  • Posts: 392
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

The types of cancer that alpha interferons are used to treat include hairy cell leukemia, melanoma, follicular non-Hodgkin's lymphoma, and AIDS-related Kaposi's sarcoma.

Did you know?

You should not take more than 1,000 mg of vitamin E per day. Doses above this amount increase the risk of bleeding problems that can lead to a stroke.

Did you know?

There are 20 feet of blood vessels in each square inch of human skin.

Did you know?

The first oral chemotherapy drug for colon cancer was approved by FDA in 2001.

Did you know?

ACTH levels are normally highest in the early morning (between 6 and 8 A.M.) and lowest in the evening (between 6 and 11 P.M.). Therefore, a doctor who suspects abnormal levels looks for low ACTH in the morning and high ACTH in the evening.

Defensive mutualism involves species that receive food or shelter in return for providing protection Defensive mutualism involves species that receive food or shelter in return for providing protection
Urinalysis. During a simple urinalysis, a stick with colored blocks is dipped into a urine specimen. Urinalysis. During a simple urinalysis, a stick with colored blocks is dipped into a urine specimen.
Part A - Calculating the expected number of each phenotype Part A - Calculating the expected number of each phenotype
A standard employment application form may be used. A standard employment application form may be used.
Mobilize neck in wavelike motion. Return the head to a neutral position facing upward. Apply ... Mobilize neck in wavelike motion. Return the head to a neutral position facing upward. Apply ...
The expected value for a binomial probability distribution is _____. The expected value for a binomial probability distribution is _____.
Video: Neural regulation of mechanical digestion- CNS voluntary, ANS & ENS controlled involuntary movements

For a complete list of videos, visit our video library