Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard...

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard deviation of expected returns. Stock Y has a 13.0% expected return, a beta coefficient of 1.3, and a 30.0% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%.

Calculate each stock's coefficient of variation. Round your answers to two decimal places. Do not round intermediate calculations.

CV_x =

CV_y =
Calculate each stock's required rate of return. Round your answers to two decimal places.

r_x = %

r_y = %
Calculate the required return of a portfolio that has $2,000 invested in Stock X and $5,000 invested in Stock Y. Do not round intermediate calculations. Round your answer to two decimal places.

r_p = %

Expert Solution

RETURN ON PORTFOLIO CAN BE CALCULATED USING 2 METHODS. I HAVE EXPLAINED BOTH OF THEM

jeff jeffy answered 1 year ago

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard...

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Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard...

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