Stock X has a 10.5% expected return, a beta coefficient of 1.0, and a 30% standard...

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Stock X has a 10.5% expected return, a beta coefficient of 1.0,and a 30% standard deviation of expected returns. Stock Y has a12.0% expected return, a beta coefficient of 1.1, and a 30.0%standard deviation. The risk-free rate is 6%, and the market riskpremium is 5%. Calculate each stock's coefficient of variation.Round your answers to two decimal places. Do not round intermediatecalculations. CVx = CVy = Which stock is riskier for a diversifiedinvestor? For diversified investors the relevant risk is measuredby beta. Therefore, the stock with the higher beta is more risky.Stock Y has the higher beta so it is more risky than Stock X. Fordiversified investors the relevant risk is measured by standarddeviation of expected returns. Therefore, the stock with the higherstandard deviation of expected returns is more risky. Stock X hasthe higher standard deviation so it is more risky than Stock Y. Fordiversified investors the relevant risk is measured by beta.Therefore, the stock with the lower beta is more risky. Stock X hasthe lower beta so it is more risky than Stock Y. For diversifiedinvestors the relevant risk is measured by standard deviation ofexpected returns. Therefore, the stock with the lower standarddeviation of expected returns is more risky. Stock Y has the lowerstandard deviation so it is more risky than Stock X. Fordiversified investors the relevant risk is measured by beta.Therefore, the stock with the higher beta is less risky. Stock Yhas the higher beta so it is less risky than Stock X. Calculateeach stock's required rate of return. Round your answers to twodecimal places. rx = % ry = % On the basis of the two stocks'expected and required returns, which stock would be more attractiveto a diversified investor? Calculate the required return of aportfolio that has $3,000 invested in Stock X and $6,500 investedin Stock Y. Do not round intermediate calculations. Round youranswer to two decimal places. rp = % If the market risk premiumincreased to 6%, which of the two stocks would have the largerincrease in its required return? Check My Work

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Calculate each stocks coefficient of variation Round your answers to two decimal places Do not round intermediate calculations CVx 30105286 CVy 3012250 Which stock is riskier for a diversified See Answer

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Stock X has a 10.5% expected return, a beta coefficient of 1.0,and a 30% standard deviation of expected returns. Stock Y has a12.0% expected return, a beta coefficient of 1.1, and a 30.0%standard deviation. The risk-free rate is 6%, and the market riskpremium is 5%. Calculate each stock's coefficient of variation.Round your answers to two decimal places. Do not round intermediatecalculations. CVx = CVy = Which stock is riskier for a diversifiedinvestor? For diversified investors the relevant risk is measuredby beta. Therefore, the stock with the higher beta is more risky.Stock Y has the higher beta so it is more risky than Stock X. Fordiversified investors the relevant risk is measured by standarddeviation of expected returns. Therefore, the stock with the higherstandard deviation of expected returns is more risky. Stock X hasthe higher standard deviation so it is more risky than Stock Y. Fordiversified investors the relevant risk is measured by beta.Therefore, the stock with the lower beta is more risky. Stock X hasthe lower beta so it is more risky than Stock Y. For diversifiedinvestors the relevant risk is measured by standard deviation ofexpected returns. Therefore, the stock with the lower standarddeviation of expected returns is more risky. Stock Y has the lowerstandard deviation so it is more risky than Stock X. Fordiversified investors the relevant risk is measured by beta.Therefore, the stock with the higher beta is less risky. Stock Yhas the higher beta so it is less risky than Stock X. Calculateeach stock's required rate of return. Round your answers to twodecimal places. rx = % ry = % On the basis of the two stocks'expected and required returns, which stock would be more attractiveto a diversified investor? Calculate the required return of aportfolio that has $3,000 invested in Stock X and $6,500 investedin Stock Y. Do not round intermediate calculations. Round youranswer to two decimal places. rp = % If the market risk premiumincreased to 6%, which of the two stocks would have the largerincrease in its required return? Check My Work