Using the information listed above write the beta-version


Assume a market return of 9% and the following information:

Security          Expected Return      Std Deviation

                        X                        3.0%                            0.0%                           

                        Y                       12.0%                          20.0%                         

A. Using the information listed above, write the beta-version SML equation of the CAPM.

B. Using the expected returns listed in the table above, calculate the beta for stock Y.

C. Given your answer, what can we expect about the return of stock Y if the market return is expected to fall by 2%.

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Financial Management: Using the information listed above write the beta-version
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