Problem 24-7 TUTOR WILL YOU PLEASE PLACE THE HOMEWORK ON A EXCEL SPREAD-SHEET THANK YOU Characteristic Line and Security Market Line eBook You are given the following set of data: HISTORICAL RATES OF RETURN Year NYSE Stock X 1 - 26.5% - 16.0% 2 37.2 25.0 3 23.8 15.0 4 - 7.2 4.0 5 6.6 10.5 6 20.5 15.7 7 30.6 17.0 Use a spreadsheet (or a calculator with a linear regression function) to determine Stock X's beta coefficient. Round your answer to two decimal places. Beta = Determine the arithmetic average rates of return for Stock X and the NYSE over the period given. Calculate the standard deviations of returns for both Stock X and the NYSE. Round your answers to two decimal places. Stock X NYSE Average return, r?Avg ? % ? % Standard deviation, ? ? % ? % Assume that the situation during Years 1 to 7 is expected to prevail in the future (i.e., r??x???=???rx? , r??M???=???r?M? , and both ??x and b?x in the future will equal their past values). Also assume that Stock X is in equilibrium - that is, it plots on the Security Market Line. What is the risk-free rate? Round your answer to two decimal places. ? % Plot the Security Market Line. Select the correct graph. The correct graph is .
Paper#5284 | Written in 18-Jul-2015Price : $25