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For each of the scenarios below, determine whether the information that

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For each of the scenarios below, determine whether the information that is given is consistent with the Capital Asset Pricing Model. (i.e., it is possible that the information as well as the CAPM are true) Explain your reasoning. Suggestion: Use the mean-SD diagram.;The three parts should be done independently.;Scenario 1);***Portfolio --- Expected Return -- Standard Deviation***;Risk Free --- 4% -- 0%;Market --- 14% --- 20%;Fund A --- 16% --- 18%;Scenario 2);***Portfolio --- Expected Return -- Return Beta***;Blue Fund --- 30% --- 0.8;Red Fund --- 20% --- 1.1;Scenario 3);***Portfolio --- Expected Return -- Standard Deviation***;Risk-free --- 12% --- 30%;Market --- 8% --- 35%;Additional Requirements;Level of Detail: Show all work

 

Paper#21548 | Written in 18-Jul-2015

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