8. value: 10.00 points Consider the following information: Rate of Return if State Occurs State of Economy Recession Normal Boom Probability of State of Economy 0.20 0.50 0.30 Stock A 0.02 0.08 0.13 Stock B -0.19 0.15 0.35 Required: (a) Calculate the expected return for Stock A. (Do not round your intermediate calculations.) (Click to select) (b) Calculate the expected return for Stock B. (Do not round your intermediate calculations.) (Click to select) (c) Calculate the standard deviation for Stock A. (Do not round your intermediate calculations.) (Click to select) (d) Calculate the standard deviation for Stock B. (Do not round your intermediate calculations.) (Click to select) 7. value: 10.00 points Consider the following information: State of Economy Recession Normal Boom Probability of State of Economy 0.21 0.55 0.24 Rate of Return If State Occurs -0.03 0.12 0.28 Required: Calculate the expected return. 2.47% 13.32% 13.20% 12.69% O 12.06% 10. value: 10.00 points You own a stock portfolio Invested 20 percent in Stock Q. 20 percent In Stock R, 15 percent in Stock S, and 45 percent in Stock T. The betas for these four stocks are 1.17, 1.69, 0.68, and 1.11, respectively. What is the portfolio beta? 1.23 1.15 1.2 1.11 1.17 6. value: 10.00 points You own a portfollo that has $1,500 Invested in Stock A and $3,850 Invested in Stock B. If the expected returns on these stocks are 8 percent and 15 percent, respectively, what is the expected return on the portfollo?(Do not round your intermediate calculations.) 13.04% 11.50% 13.30% 9.96% 13.69% 5. value 10.00 points A portfolio has 85 shares of Stock A that sell for $46 per share and 115 shares of Stock B that sell for $16 per share Required: (a) What is the portfolio weight of Stock A? (Click to select) (b) What is the portfolio weight of Stock B? (Click to select) 4. value: 10.00 points A project has an initial cost of $54,000 and a four-year life. The company uses straight-line depreciation to a book value of zero over the life of the project. The projected net income from the project is $2.000, $3,900, $4,500, and $4,500 a year for the next four years, respectively. What is the average accounting return? 52.59 percent 6.90 percent 27.59 percent 7.25 percent 13.80 percent 3 value 10.00 points It will cost $4,300 to acquire a small Ice cream cart. Cart sales are expected to be $3,500 a year for five years. After the five years, the cart is expected to be worthless as that is the expected remaining life of the cooling system. What is the payback period of the ice cream cart? 0.81 years 0.25 years 4.07 years 6.14 years 1.23 years 2. value: 10.00 points What is the profitability Index for an Investment with the following cash flows given a 6 percent required return? Year 0 1 2 3 Cash Flow -$37.000 15.700 18.000 17,400 1.38 0.81 O O O O O 1.06 0.72 1.23 1. value: 10.00 points What is the net present value of a project with the following cash flows and a required return of 16 percent? Year 0 1 2. Cash Flow -$37,600 15.100 26.530 3.300 3 -$2,414.21 -$5,471.94 -$2.752.48 $2,752.48 $2.414.21 11. value: 10.00 points A stock has a beta of 1.55, the expected return on the market is 9 percent, and the risk-free rate is 4.05 percent. What must the expected return on this stock be? 18% 12.31% 12.19% 11.14% 11.72%