Details of this Paper

Assume the risk free rate is 6% and the market premium is 5%

Description

solution


Question

Year Stock X Stock Y Market;2009 14% 13% 12%;2010 19% 7% 10%;2011 -16% -5% -12%;2012 3% 1% 1%;2013 20% 11% 15%;Assume the risk free rate is 6% and the market premium is 5%;a.) What are the betas of 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;I know the answers are: a.) 1.3471,.6508 b.) 12.7355%, 9.254% c.) 12.04%;But I cannot figure out how to get there.

 

Paper#25912 | Written in 18-Jul-2015

Price : $22
SiteLock