Give typing answer with explanation and conclusion Stock A has an expected return of 15% and a beta of 1.4. The T-bill rate is 4%. If I invest in both assets, what percentage of my money would I have to put in the stock to get a portfolio beta of 0.60?

Q: . Mubita is contemplating on investing in Stocks A and B with the following probability…

A: The CAPM model that is capital asset pricing model gives the required rate on the stock based on the…

Q: Assume that the risk-free rate is 2.5% and the required return on the market is 8%. What is the…

A: According to capital assets pricing model, The expected return on equity stock is calculated as…

Q: beta of 1.40 and an expected return of 19%. Stock Z has a beta of 0.65 and an expected return of…

A: We need to compute expected return using CAPM (Capital asset pricing model) for each stock. CAPM…

Q: The current appropriate risk-free rate is 6% and the return on the market is 13.5%.   levered beta…

A: Risk Free Rate = 6% Expected Return on market portfolio = 13.5% Beta = 1.29

Q: You have bought a stock for a $100. You are expecting to get a return of 10% while the volatility of…

A: Calculation of the stock price range (Upper bound and Lower Bound) is shown below: Hence, the price…

Q: Assume that the risk-free rate is 6.5% and the required return on the market is 10%. What is the…

A: To calculate the required rate of return on a stock, we need to use capital asset pricing model…

Q: Y has a beta of 1.50 and an expected return of 17 percent. Stock Z has a beta of 0.80 and an…

A: CAPM gives the required rate of return based beta of the stock and risk free rate and market average…

Q: You have just invested in a portfolio of three stocks. The amount of money that you invested in each…

A: As per Capital Assets Pricing Model the expected return is calculated with the help of following…

Q: You own a portfolio that has $3,000 invested in Stock A and $4,100 invested in Stock B. Assume the…

A: The expected return on portfolio is calculated as weighted proportion of stock multiplied by the…

Q: You have a required rate of return of 11.4%. If the current risk-free rate is 3%, and your stock has…

A: In this question we require to calculate the market risk premium. We can calculate market risk…

Q: You decide to form a portfolio of the following amounts invested in the following stocks. What is…

A: A portfolio speaks to a collection of monetary resources, such as stocks, bonds, and cash…

Q: If the risk free rate is 6 %, the expected return on the market portfolio is 12% and the beta of…

A: The Capital Asset Pricing Model (CAPM) is the model which shows the relationship between the…

Q: Suppose you have a portfolio that has $290 in stock A with a beta of 1.04, $1, 160 in stock B with a…

A: Beta of portfolio is computed as follows:-Bp = (Ba*Wa)+(Bb*Wb)+(Br*Wr)+(Bs*Ws)whereBp =beta of…

Q: What is the required return on an investment with a beta of 1.4 if the risk-free rate is 2.2 percent…

A: Capital Asset Pricing Model (CAPM) equation is used to determine the required return on an…

Q: How do I calculate the Portfolio Expected Return: You own a portfolio that has $4,600 invested in…

A: In this question we are required to calculate expected return of our portfolio having two stocks…

Q: You are thinking of buying a stock priced at $100 per share. Assume that the risk-free rate is about…

A: CAPM model is capital asset pricing model which is used to calculate required return. It takes into…

Q: Please help me with 11-5 ??‍♀️

A:

Q: Suppose the CAPM holds. The risk-free rate is 2%, and the expected return of the market portfolio is…

A: As per CAPME(ri) = Rf  + Bi * (E(Rm) - Rf)E(ri) = Expected returnRf = Risk free rateBi = BetaE(Rm) =…

Q: Consider the CAPM. The risk - free rate is 4%, and the expected return on the market is 15% .…

A: Risk-free Rate, Rf = 4%Beta = 1.2Expected return on market = 15%

Q: Based on the CAPM model, what should be the expected return for a stock with a beta of 2.1 when the…

A: The Capital Asset Pricing Model (CAPM) is used to calculate the expected return of a stock based on…

Q: You are considering adding Gamma stock to your portfolio. What is the required return on the stock…

A: Required return: It is the return that is accepted by an investor for holding a stock of a…

Q: what is the stock's predicted return

A: Market return is 10%return on the SMB portfolio (rSMB) is 2.0 return on the HML portfolio (rHML) is…

Q: Assume the following information about the market and Lithium Motors Stock.​ Lithium's beta​ = 1.80,…

A: Beta (b) = 1.80 Risk free rate (Rf) = 0.025 Market risk premium (Mp) = 0.08 Expected return = ?…

Q: Stock Z has a beta of 1.4, and its required rate of return is 10.00%. Stock B's beta is 0.80. If the…

A: In the given case, we have provided the stock Z beta, required rate of return and risk free rate.…

Q: Assume that you are using the Capital Asset Pricing Model (CAPM) to find the expected return for a…

A: The Capital Asset Pricing Model (CAPM) is a financial model used to estimate the expected return on…

Q: Assume that the risk-free rate is 3.6% and the market risk premium is 4%. What is the required rate…

A: Risk-Free Rate = 3.6%Market Risk Premium = 4%Beta = 1.4

Q: You've assembled the following portfolio: Stock Expected return Beta Portfolio weight 1 0.128 1.8…

A: Beta is primarily used to calculate the systematic risk in the capital asset pricing model. The beta…

Q: a.) Using Capital Asset Pricing Model (CAPM) to compute an appropriate rate of return for Intel…

A: In this question we are required to calculate rate of return of Intel common stock using CAPM: As…

Q: Assume that the risk-free rate is 3% and the expected return on the market is 11%. What is the…

A: In the given question we are require to calculate the required rate of return on a stock. We can…

Q: Which stock should have a higher actual return next year

A: The beta of a stock is the degree of responsiveness to movements in price with changes in the stock…

Q: Stock A has a beta of 1.5, stock B has a beta of 0.75, you invest 30% in A and 70% in B. What is the…

A: Beta of Portfolio = [(Stock A beta)*(weight of stock A)] + [(stock B beta)*(weight of stock B)]

Q: Free Rate is 4% and the Beta for Stock Y is 0.7.             Select one: a. 34% b. None c.…

A: Using CAPM

Q: What is the required return on an investment with a beta of 1.4 if the risk-free rate is 2.2 percent…

A: Formula:- Required return = Risk free rate + beta*(market rate- risk free rate)

Q: Stock J has a beta of 1.37 and an expected return of 14.01%. Stock K has a beta of .92 and an…

A: Beta of portfolio.Bp = (Bj * Wj)+(Bk*Wk)whereBp = beta of portfolioBj = beta of stock JBk = beta of…

Q: assume that expected return of the stock A in Rachel's portfolio is 13.6% this year.The risk premium…

A:

Q: You are examining three different shares. Share A has expected return 5.20 %, beta 0.47, and…

A: Capital Asset pricing Model helps in determining the fair return of the investment. It determines…

Q: Find risk free rate and expected return of market portfolio based on the following information -…

A: Expected return (CAPM) = Rf+β*Rp.Rf = Risk free rate.Rp = Risk premium.

Q: Assume that the risk-free rate is 7.5% and the required return on the market is 13%. What is the…

A: In the Given Question we require to calculate the required rate of return on a stock using following…

Q: Company A has a beta of 0.9 , while Company B's beta is 1.4 . The market risk premium is 13.78 %,…

A: The Capital Asset Pricing Model (CAPM) illustrates the relationship between systematic risk, or the…

Q: A stock has an expected return of 12.69 percent and its reward-to-risk ratio is 7.6 percent. If the…

A: In this question, we are required to determine the value of beta.

Q: Suppose that the index model for stocks A and B is estimated from excess returns with the following…

A: The standard deviation of a portfolio is a statistical measure of the variability or volatility of…

Q: Find the Beta for Stock Y given the Expected Return of Stock Y is 18.4% The expected return on the…

A: A stock with a beta higher than 1.0 fluctuates far more than the market with age. The beta of a…

Q: Calculate the Sharpe ratio, Treynor ratio, M-squared and Jensen's alpha for a stock with an expected…

A: 1) Sharp ratio = (Return of the portfolio - Return of Risk free investment) / Standard deviation of…

Stock Market Indices

Stock indexes are used to compare the price fluctuations of a group of stocks of similar companies, which are combined based on a similar industry or a particular market capitalization limit or type of market. The price comparison is based on a pre-determined standard method or indicators. These stock indexes are usually considered a base for comparison of a particular stock, and the performance of that particular company can be easily determined.