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please show all steps and workings! thanks 16. The...

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Finance

please show all steps and workings!
thanks image
16. The total value of your portfolio is $50,000. $20,000 of it is invested in stock X and the remainder is invested in stock Y. Stock X has a beta of 0.75, stock Y has a beta of 2.15. The risk premium on the market portfolio is 7%, the risk free rate is 2%. Additional information on stock X and is provided below. a) What are each stock's expected return and the standard deviation? b) What are the expected return and the standard deviation of your portfolio? c) What is the beta of your portfolio? d) Answer the following: i/ Using CAPM, what is the expected return of the portfolio? ii/ Given your answer in (i), would you buy, sell, or hold the portfolio? Stock Y State Excellent Normal Poor Profitability of State 10% 55% 35% Return in each state 1 Stock X 15% 9% -15% 5% 7% 10%

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