1)

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2)
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3) Youve observed the
following returns on Crash-n-Burn Computers stock over the past five years: 18
percent, 3 percent, 16 percent, 11 percent, and 10 percent.
a) What was the arithmetic
average return on Crash-n-Burns stock over this five-year period? (Round your answer to 1 decimal place. (e.g., 32.1))
b) What
was the variance of Crash-n-Burns returns over this period? (Round your answer to 5 decimal places. (e.g., 32.16161))
c) What was the standard deviation of
Crash-n-Burns returns over this period? (Do not
round intermediate calculations and round your final answer to 2 decimal
places. (e.g., 32.16))
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6)Assume
that the returns from an asset are normally distributed. The average annual
return for this asset over a specific period was 17.4 percent and the standard
deviation of those stocks in this period was 43.77 percent.
a) What is the approximate
probability that your money will double in value in a single year? (Do not round intermediate calculations and round your
final answer to 2 decimal places. (e.g., 32.16))
b) What about triple in value? (Round your answer to 6 decimal places. (e.g., 32.161616))
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8) You own a
portfolio that is 32 percent invested in Stock X, 20 percent in Stock Y, and 48
percent in Stock Z. The expected returns on these three stocks are 6 percent,
19 percent, and 15 percent, respectively. What is the expected return on the
portfolio? (Round your answer to 2 decimal places.
(e.g., 32.16))

9) You have $20,000
to invest in a stock portfolio. Your choices are Stock X with an expected
return of 11 percent and Stock Y with an expected return of 12.0 percent. If
your goal is to create a portfolio with an 1expected return of 11.39 percent,
how much money will you invest in Stock X?
and Stock Y?

10) You own a stock
portfolio invested 40 percent in Stock Q, 30 percent in Stock R, 20 percent in
Stock S, and 10 percent in Stock T. The betas for these four stocks are 0.87,
1.20, 1.04, and 1.22, respectively. What is the portfolio beta? (Round your answer to 2 decimal places. (e.g., 32.16))
11) A stock has a
beta of 1.36, the expected return on the market is 10 percent, and the
risk-free rate is 2.5 percent. What must the expected return on this stock be? (Round your answer to 2 decimal places. (e.g., 32.16))
12) A stock has an
expected return of 10.4 percent, the risk-free rate is 3 percent, and the
market risk premium is 5 percent. What must the beta of this stock be? (Round your answer to 2 decimal places. (e.g., 32.16))
13) A stock has an
expected return of 13.5 percent, its beta is 1.45, and the risk-free rate is
6.5 percent. What must the expected return on the market be? (Round your answer to 2 decimal places. (e.g., 32.16))
14) A stock has an expected return of
10.5 percent, its beta is 1.55, and the expected return on the market is 8.5
percent. What must the risk-free rate be?

15)

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16) .0/msohtmlclip1/01/clip_image018.png”>1)
.0/msohtmlclip1/01/clip_image002.png”>2).0/msohtmlclip1/01/clip_image004.png”>.0/msohtmlclip1/01/clip_image006.png”>3) Youve observed the
following returns on Crash-n-Burn Computers stock over the past five years: 18
percent, 3 percent, 16 percent, 11 percent, and 10 percent. a) What was the arithmetic
average return on Crash-n-Burns stock over this five-year period? (Round your answer to 1 decimal place. (e.g., 32.1)) b) What
was the variance of Crash-n-Burns returns over this period? (Round your answer to 5 decimal places. (e.g., 32.16161)) c) What was the standard deviation of
Crash-n-Burns returns over this period? (Do not
round intermediate calculations and round your final answer to 2 decimal
places. (e.g., 32.16))4).0/msohtmlclip1/01/clip_image008.png”>5).0/msohtmlclip1/01/clip_image010.png”>6)Assume
that the returns from an asset are normally distributed. The average annual
return for this asset over a specific period was 17.4 percent and the standard
deviation of those stocks in this period was 43.77 percent. a) What is the approximate
probability that your money will double in value in a single year? (Do not round intermediate calculations and round your
final answer to 2 decimal places. (e.g., 32.16)) b) What about triple in value? (Round your answer to 6 decimal places. (e.g., 32.161616))7).0/msohtmlclip1/01/clip_image012.png”>8) You own a
portfolio that is 32 percent invested in Stock X, 20 percent in Stock Y, and 48
percent in Stock Z. The expected returns on these three stocks are 6 percent,
19 percent, and 15 percent, respectively. What is the expected return on the
portfolio? (Round your answer to 2 decimal places.
(e.g., 32.16))9) You have $20,000
to invest in a stock portfolio. Your choices are Stock X with an expected
return of 11 percent and Stock Y with an expected return of 12.0 percent. If
your goal is to create a portfolio with an 1expected return of 11.39 percent,
how much money will you invest in Stock X?
and Stock Y?10) You own a stock
portfolio invested 40 percent in Stock Q, 30 percent in Stock R, 20 percent in
Stock S, and 10 percent in Stock T. The betas for these four stocks are 0.87,
1.20, 1.04, and 1.22, respectively. What is the portfolio beta? (Round your answer to 2 decimal places. (e.g., 32.16))11) A stock has a
beta of 1.36, the expected return on the market is 10 percent, and the
risk-free rate is 2.5 percent. What must the expected return on this stock be? (Round your answer to 2 decimal places. (e.g., 32.16))12) A stock has an
expected return of 10.4 percent, the risk-free rate is 3 percent, and the
market risk premium is 5 percent. What must the beta of this stock be? (Round your answer to 2 decimal places. (e.g., 32.16))13) A stock has an
expected return of 13.5 percent, its beta is 1.45, and the risk-free rate is
6.5 percent. What must the expected return on the market be? (Round your answer to 2 decimal places. (e.g., 32.16))14) A stock has an expected return of
10.5 percent, its beta is 1.55, and the expected return on the market is 8.5
percent. What must the risk-free rate be?15).0/msohtmlclip1/01/clip_image014.png”>.0/msohtmlclip1/01/clip_image016.png”>16) .0/msohtmlclip1/01/clip_image018.png”>