Fill in the gaps and answer the questions

I don’t know how to handle this Mathematics question and need guidance.

Save your time - order a paper!

Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlines

Order Paper Now

1) a) Fill in the 8 missing values in the table.

 Security Expected Return Standard Deviation Correlation* Beta Firm A .105 .31 =_______ .85 Firm B .148 =_______ .50 1.40 Firm C .160 .65 .35 =_______ Market Portfolio .120 .20 =_______ =_______ Risk–free asset .050 =_______ =_______ =_______

* with the market portfolio

b) According to the CAPM, Is the stock of Firm A correctly priced (check the correct box)?

Yes □ No (the stock is overpriced) □ No (the stock is underpriced) □

c) According to the CAPM, Is the stock of Firm B correctly priced (check the correct box)?

Yes □ No (the stock is overpriced) □ No (the stock is underpriced) □

d) According to the CAPM, Is the stock of Firm C correctly priced (check the correct box)?

Yes □ No (the stock is overpriced) □ No (the stock is underpriced) □