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1) An investor has put money in four stocks in the dollar amounts indicated and with betas specified. What is the portfolio beta? Stock A $3,780 with a beta of 1.03; stock B $7,411 with a beta of 1; stock C $5,584 with a beta of 1.03; and stock D $5,895 with a beta of 1.19. Show your answer rounded to two decimal points.

2) What is the required return for Dentrix Corporation? The risk-free rate is 2.5%, the risk premium is 6.8, the expected rate of inflation is 3.4% and the company can currently issue bonds at a YTM of 4.9%. The company's beta is estimated to be 1.09. round your answer to two decimal places and express your answer as a percentage, not as a decimal.

3) Stock X has an expected return of 0.08. It has a beta estimated at 0.9, a risk-free rate of 0.03 and a risk premium of 6.6. Its variance of returns is 0.0072. All returns here are expresed as decimals, not percentages. What is its coefficient of variation? Round your answer to two decimal places.

4) Ranyard's beta is 1.18, and the last dividend per share paid was $3.68. The market risk premium is estimated to be 6.56%, and the real rate of interest is 2.17%. The liquidity risk premium is 0.9%. Analysts expect the company to grow at a rate of 3.95% indefinitely. The risk free rate is 3.26%. What should be Ranyard's current stock price? Round your answer to two decimal places.

Financial Management, Finance

  • Category:- Financial Management
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