Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. 1. suppose the risk-free return is 4% and the mark

1. Suppose the risk-free return is 4% and the market portfolio has an expected return...

60.1K

Verified Solution

Question

Finance

1. Suppose the risk-free return is 4% and the market portfolio has an expected return of 10% and a volatility of 16%. Shares of TataBata have a 26% volatility and a correlation of 0.33 with the market. Calculate the beta for TataBata. What CML portfolio has equivalent market risk, and what is its return?

2. Suppose SweetFoods has a beta of 0.50, whereas WingSpan has a beta of 1.25. If the risk-free rate is 4%, and the expected return of the market portfolio is 10%, what is the expected return of an equally weighted portfolio of these 2, according to the CAPM?

please provide step by step solution.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Activity: Funding 401(k)s and Roth IRAs Objective: The purpose of this activity is to learn to calculate...

Finance
Q

The health of the bear population in Yellowstone National Park is monitored by periodic measurements taken from...

Basic Math
Q

1. What are the risks and benefits of using recombination to generate new receptors on the...

Medical Sciences
Q

You are measuring the distance between the 6th and 2nd levels of the hydrogen atom while...

Physics
Q

what are the characteristics of optimization problems

General Management
Q

The next two questions are from the American Cinema episode on Film Noir Two parallels...

Basic Math
Q

A Food Marketing Institute found that 27% of households spend more than $125 a week...

Basic Math
Q

The equation y = -143x + 1810x - 187x+2231 where x represents the time in...

Basic Math
Q

Find the product y 3 y 7 y 3 y 7 Simplify your answ

Algebra
Q

A cost that differs between alternatives and makes a difference in decision-making is called a(n)...

Accounting
Q

Net cash flow from operating activities for 2021 for HK Corporation was $335,000. The following...

Accounting
Q

DM01"1.1 Kris Nats get moto ripa biznis, Nuts and Bolts, we im stat fo 1...

Accounting