1. You have $66,000. You put 22% of your money in a stock with an expected return of 15%, $38,000 in a stock with an expected return of 14%, and the rest in a stock with an expected return of 23%. What is the expected return of your portfolio?
2. A project with an initial cost of $59,200 is expected to provide annual cash flows of $11,500 ver the 6-year life of the project. If the required return is 8.2 percent, what is the project's profitability index?