1. An investment earned the following returns for the years 2013 through 2016:20%, 50%, -30%, and 10%. What is the variance of returns for this investment?

a. 0.0892

b. 0.2987

c. 0.1541

d. 0.1092

e. 0.0292

2. Al's Audio has a cost of debt of 7 percent, a cost of equity of 12 percent, and a cost of preferred stock of 8 percent. The weight for debt is 0.16, the weight for preferred shares is 0.34, and the weight for common stock is 0.5. The company's tax rate is 34 percent. What is the weighted average cost of capital for Al's Audio Shop?

a. 9.68 percent

b. 9.15 percent

c. 9.46 percent

d. 6.54 percent

e. 6.14 percent