This preview shows pages 1–3. Sign up to view the full content.
This preview has intentionally blurred sections. Sign up to view the full version.
View Full Document
Unformatted text preview: 12%5% 25 0.2 5 3 12% 12% 0% 0.3 4 15% 12% 3% 9 0.2 1.8 5 16% 12% 4% 16 0.1 1.6 28.4 Standard deviation for Y 5.33% C) Prob #2 r r^ o z 33.00% 22.00% 11.00%1.67 0.00% 22.00% 11.00%2.00 Probability of <33% 4.46% Possibility of a loss= 2.28% Prop #3 Company r o v Cornhusker Enterprise 20% 10% 0.50 Mustang Associates 15% 9% 0.60 A) B) Stock X Appears to be Riskier because possible rerurns from X are more variable, measured by its standard deviation of 11.62%, than those from stock Y, which have a standard deviation of only 5.33%. Cornhusker Enterprise returns have a lower coefficient of variation than Mustang Associates; therefore Cornhusder Enterprise is the less risky of the two investments. Then Mustang would be the lower risk and a possibly higher return. Prob #4 Beta Risk free Market risk % of Portfolio r on portfolis Treasury Bills 6% 9% 33% General Electric 1.3 67%...
View
Full
Document
This homework help was uploaded on 02/17/2008 for the course BUSS fin301 taught by Professor Ken during the Spring '08 term at Grand Canyon.
 Spring '08
 Ken

Click to edit the document details