Quiz5-7_Solutions

4 t of estion Determine the market value of a Digicel Stock if Do = 3.00, Ks = 13%, G = 6%. Select one: O a. O b. O c. O d. $45.43 $30.29 $53.00 $3.18

The return of stock B is __% The volatility of stock A is __% The volatility of stock B is __%

Esc Chapter 12 Practice Problems 1. Suppose a stock had an initial price of $77 per share, paid a dividend of $1.35 per share during the year, and had an ending share price of $83. Compute the percentage total return. Q Search 1 Q A N @ 2 W S F2 X # 3 E F3 D $ 4 R F DII % 5 F5 T G * F6 A 6 Y B * H & 7 PrtScn U N * 8 Home 1 M 9 Page K End о F10 ) 0 PgUp F11 P

Question 2 Consider a market consisting of three stocks with the following information: Si Stock S2 S3 Price $100 $200 $500 Return 1.04 1.08 1.10 Standard 0.1 0.2 0.3 deviation For any two stocks i and j, o, = cov(x,,x,)=0,0,P,- Here, Piz =0.1,Piz =-0.8, P3 =0.2. What are the mean return and variance of this portfolio?

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Use the information below to answer the question 52WHI 52WLo Ticker Div Yield % P/E Vol 00s High Low Close Net Chg 52.53 28.31 KO 0.65 1.34 13.80 6, 412 54.12 32.50? -0.81 What was the previous day's closing price?$50.10 $51.32 $49.32 $48.74

Use the information below to answer the question 52WH 52WLo Ticker Div Yield % P/E Vol 00s High Low Close Net Chg 52.53 28.31 KO 0.65 1.34 13.80 6,412 54.12 32.50? -0.81 What was the previous day's closing price? O $51.32 O $48.74 O $50.10 O $49.32

A4 5c Consider the following information on three stocks in four possible future states of the economy:    State of economy Probability of state of economy Stock A Stock B Stock C Boom 0.3 0.35 0.45 0.38 Good 0.3 0.15 0.20 0.12 Poor 0.3 0.05 –0.10 –0.05 Bust 0.1 0.00 –0.30 –0.10  stock A: State of economy Probability Rate of return Average (a) (b) (c) (d = b × c)(d = b × c) Boom 0.3 0.35 0.105 Good 0.3 0.15 0.045 Poor 0.3 0.05 0.015 Bust 0.1 0 0 Expected rate of return 0.165   stock B: State of economy Probability Rate of return Average (a) (b) (c) (d = b × c)(d = b × c) Boom 0.3 0.45 0.135 Good 0.3 0.2 0.06 Poor 0.3 -0.1 -0.03 Bust 0.1 -0.3 -0.03 Expected rate of return 0.135 Stock C: State of economy Probability Rate of return Average (a) (b) (c) (d = b × c)(d = b…

2:25 1 LTE What is the rate of return when 25 shares of Stock A, purchased for $30/share, are sold for $825? The commission on the sale is $6. Skip Rate of Return = [ ? ] % Give your answer as a percent rounded to the nearest tenth. Enter Done W e r y u ор a S d f g h j k C V n m 123 space return Help Resources

Use the information below to answer the question 52WHI 52WLo Ticker Div Yield% P/E Vol 00s High Low Close Net Chg 52.53 28.31 KO 0.65 1.34 13.80 6,412 54.12 32.50? -0.81 What is the EPS for the stock? $3.52 O $2.94 O $3.08 O $2.12

11:54 AM | 1.4KB/s Va 4G 67 Chegg Hide student question Time Left: 01:53:31 Student question 8 > How would this be solved on excel? Stock A: 20% of portfolio, 10% expected return Stock B: 30% of portfolio, 11% expected return Stock C: 15% of portfolio, 8% expected return Stock D: 35% of portfolio, 12.5% expected return Find the portfolio's expected return when it has these four stocks: Stock A: 20% of portfolio, 10 % expected return Stock B: 30% of portfolio, 11% expected return Stock C: 15% of portfolio, 8% expected return Stock D: 35% of portfolio, 12.5% expected return Skip Exit Submit 1 III

Given Investment E(R) σ Stock A $15,000 10% 10% Stock B $5,000 5% 25% Total $20,000 and Corr(AB) = PAB = −0.25. Find the Covariance between returns of A and B -0.00525 O 0.0625 -0.00625 0.00625 -0.0625

Name Symbol Close Net Chg Volume 52 Wk High 52 wk low Div Yield P/E YTD %Chg Gen Dyn GD 142.97 -0.47 1,375,410 153.76 121.61 3.04 2.13 15.39 11.  W4.08   1. How many shares could you buy for $5,000? 2. What must be Gen Dyn's earnings per share? 3. What was the firms' closing price on the day before the listing?

3 is not the right answer can someone help?

Beta Market 1 Firm A 1.25 Firm B 0.6 Market Return 10% Risk Free Rate 2% The market risk premium is O A. 4%. О В. 2%. ОС. 8%. D. 6%.

11,12,13,14 and 15 please

5:37 :4G pucsr.school/mod/as 1 Homework-Unit 05 Homework Problem01: You have $100,000 to invest in a portfolio containing Stock X and Stock Y. Your goal is to create a portfolio that has an expected return of 17 percent. If Stock X has an expected return of 14.8 percent and a beta of 1.35, and Stock Y has an expected return of 11.2 percent and a beta of .90, how much money will you invest in Stock Y? How do you interpret your answer? What is the beta of your portfolio? Problem02: Consider the following information about Stocks I a II: Rate of Return If State Occurs State of Probability of State of Economy Economy Stock I Stock II Recession .25 .02 -.25 Normal .50 .21 .09 Irrational exuberance .25 .06 .44 The market risk premium is 7 percent, and the risk-free rate is 4 percent. Which stock has the most systematic risk? Which one has the most unsystematic risk? Which stock is “riskier"? Submission status

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Compute the information ratio for portfolio B. Round off your answer to three digits after the decimal point.

Securities A B C D E 4 Select one: OA. 2.50% O B. 3.73% OC. 1.98% Expected Standard Return (in %) Deviation of with 4.11 15.55 8.12 8.20 12.50 O D. 2.79% Correlation Beta 19 36.7 10 24.5 14 Returns (in %) Portfolio Market 0.56 0.78 0.42 0.99 The standard deviation of the returns on the market portfolio is 15%, and its expected return is 9.5%. The riskless asset has a return of 2.5%. Which of the following results is closest to the unsystematic risk of a portfolio comprised of 60% of security A and 40% of security B given that the correlation between security A and B (P(A,B)) is 0.4? 0.23 1.37 0.52 0.68 0.92

D0 = $1.75, g = 3.6%, P0 = $32, find the stock return 9.27% 9.59% 9.18% 9.13%

B20 x✓ fx A B 5 Earnings 6 4 Shares Outstanding Dividends, Per Share (Just Paid) 7 Return on Equity 8 Beta 9 10 Market Data 11 Market Return 12 Risk-Free Rate 13 25,000,000 $50,000,000 $1.25 0.15 1.35 Expected Return 0.12 0.03 14 Required: 15 16 Using the information in the tables above, complete the necessary steps to calculate the P/E ratio and the PEG ratio. 17 (Use cells A4 to B12 from the given information to complete this question.) 18 19 The M. Smith and Family Corporation 20 Capitalization Rate 21 Earnings Per Share 22 Plowback Rate 23 Sustainable Growth Rate 24 Price 25 P/E Ratio 26 Sustainable Growth Rate (as Percentage, use for PEG Calculation) 27 PEG Ratio 28 29 Calculations $2.00 0.375 0.056 5.625

B1 ẞ2 ẞ3 Stock A 2.15 1.15 .90 Stock B .92 1.75 -.35 Stock C .91 -.48 1.57 The risk premiums for the factors are 7.9 percent, 7.1 percent, and 7.5 percent, respectively. You create a portfolio with 20 percent invested in Stock A, 20 percent invested in Stock B, and the remainder in Stock C. The risk-free rate is 5 percent. What is the beta for each factor for the return on your portfolio? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Factor F1 Factor F2 Factor F3 What is the expected return on your portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return %

CENGAGE MINDTAP Week four homework Questions Problem 8.01 (Expected Return) 6. 7. 8. eBook Problem Walk-Through 9. A stock's returns have the following distribution: 10. Demand for the 11. Company's Products Probability of this Demand Occurring Weak 0.1 12. × Below average 0.2 Rate of Return if this Demand Occurs (28%) (14) 13. 14. 15. Average 0.3 13 Above average Strong 0.3 31 0.1 62 1.0 227,339 Q Search this course ? i ✓ ◄ Question 8 01 15 ▶ Check My Work Assume the risk-free rate is 3%. Calculate the stock's expected return, standard deviation, coefficient of variation, and Sharpe ratio. Do not round intermediate calculations. Round your answers to two decimal places. Stock's expected return: 280 % Standard deviation: % Coefficient of variation: Sharpe ratio: Icon Key SEP 9 ŕtv C "C 7 A O W Co A-Z Office A+ Check My Work P DOCX

Question 7 What is the beta of the following portfolio? Stock Beta 13 10 05 Investment $60 00 S50 D00 9% | 3% O 0.91 O 0.93 O 0.92 O 0.90 O None of the listed iterms is correct A Moving to another question will save this response. MacBook Air esc $ % 2 3 4 Q W R tab

l Turk Telekom 11:27 ni %40 bartleby.com שיגסרב / Finance / Q&A Library / Finance Question e Question actually been 0%. What would the new beta be, based on the most recent 11 years of data (i.e., Years 2 through 12)? Does this beta seem reasonable-that is, is the change in beta consistent with the other facts given in the problem? BETA COEFFICIENTS AND RATES OF RETURN You are given the following set of data: 8A-1 7 Historical Rates of Return (r) Stock Y(F,) NYSE (r.) Year 1 3.0% 4.0% 18.2 14.3 3 9.1 19.0 4 (6.0) (14.7) (15.3) (26.5) 33.1 37.2 7 6.1 23.8 8. 3.2 (7.2) 14.8 6.6 10 24.1 20.5 11 18.0 30.6 Mean 9.8% 9.8% 13.8 19.6 a. Construct a scatter diagram graph (on graph paper) showing the rela- tionship between returns on Stock Y and the market, as shown in