Use the table for the question(s) below. Consider the following covariances between securities: Microsoft Walmart Duke 0.0568 -0.0193 0.0037 0.1277 0.1413 Duke Microsoft -0.0193 0.2420 Wal-Mart 0.0037 0.1277 The variance on a portfolio that is made of up a $4000 in Duke and a $5000 investment in Walmart is: (round to three decimal places)

K (Expected rate of return and risk) Syntex, Inc. is considering an investment in one of two common stocks. Given the information that follows, which investment is better, based on the risk (as measured by the standard deviation) and return? Common Stock A Probability 0.20 0.60 0.20 Common Stock B Return 13% 17% 18% Probability 0.10 0.40 0.40 0.10 (Click on the icon in order to copy its contents into a spreadsheet.) Return -7% 5% 16% 21% www a. Given the information in the table, the expected rate of return for stock A is 16.40 %. (Round to two decimal places.) The standard deviation of stock A is 1.74 %. (Round to two decimal places.) b. The expected rate of return for stock B is 9.8 %. (Round to two decimal places.) The standard deviation for stock B is 6.12 %. (Round to two decimal places.)

You are given the following information concerning three portfolios, the market portfolio, and the risk- free asset: Portfolio X Y Z Market Risk-free Rp 14.5% R-squared 13.5 9.1 10.7 5.4 op 36% 31 21 26 0 6p 1.60 1.30 .80 1.00 0 Assume that the correlation of returns on Portfolio Y to returns on the market is 72. What percentage of Portfolio Y's return is driven by the market? (Enter your answer as a decimal not a percentage. Round your answer to 4 decimal places.)

In the CAPM world, if Sharpe ratio of the market portfolio is 1.25 and the correlation coefficient between stock i and the market portfolio is 0.60, what is the stock i's Sharpe ratio? → (1) 0.25; (2) 0.45; (3) 0.50; (4) 0.75; (5) 0.80; (6) 1.00; (7) 1.25; 8 (8) 1.50; (9) 1.75; (10) 2.05;