How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask linda_us Your Own Question
linda_us, Master's Degree
Category: Multiple Problems
Satisfied Customers: 7291
Experience:  A tutor for Business, Finance, Accounts and other related topics.
Type Your Multiple Problems Question Here...
linda_us is online now
A new question is answered every 9 seconds

You have observed the following returns over time. Assume that

Resolved Question:

You have observed the following returns over time. Assume that the risk free rate is 6% and the market risk premium is 5%.

Year Stock X Stock Y Market
2006 14% 13% 12%
2007 19% 7% 10%
2008 -16% -5% -12%
2009 3% 1% 1%
2010 20% 11% 15%

a. What are the betas for Stocks X and Y?

b. What are the required rates of return on Stocks X and Y?

c. What is the required rate of return on a portfolio consisting of 80% of Stock X and 20% of Stock Y?
Submitted: 5 years ago.
Category: Multiple Problems
Expert:  linda_us replied 5 years ago.

Please CLICK here for solution


linda_us and other Multiple Problems Specialists are ready to help you