someone has told me that you have the answers to those questions. I only need 1 to 14, not question 15. Thank you Document Preview: Assignment 2 1.a. If the expected rate of return on the market...

Assignment 2 1.a. If the expected rate of return on the market portfolio is 11% and the risk-free rate is 4%, find the beta for a portfolio which has an expected rate of return of 18%. b. What percentage of this portfolio must an individual put into the market portfolio in order to achieve an expected return of 18%? 2. You have forecast the correlation coefficient between the rate of return on Beta Mutual Fund and the TSX at .8. Your forecast of the standard deviations of the rates of return are .25 for Beta MF, and .20 for the TSX. How would you combine the Beta MF and a riskless security to obtain a portfolio with a volatility (beta) of .8? 3. What is the beta of an efficient portfolio with E(RP) = 15% if RF = 4%, E(RM) = 9%, and ?M = 18%? What is its ?P? What is its correlation with the market? 4. Given the facts that the common stock of the Bio Tech Corporation has E(R)= 25%, ?2R= 52%, Beta =2 and E(RM)= 15%, ? M = 20% and Rf= 5%. What is its unsystematic risk? 5. What is the beta of each stock in the following table: Expected stock returnExpected stock return StockIf Market return is –10%if Market return is +10% A+15+15 B+10-10 6. Here some historical data on the risk characteristics of Air Canada and Loblows: Air CanadaLoblaws Beta0.8.30 Average ? %149 Correlation.23 Assume that ? TSX = 17%. What is the standard deviation of a portfolio consisting of 1/3 in Air Canada, 1/3 in Loblaws and 1/3 in T-Bills? What is the approximate standard deviation of a portfolio composed of 1000 stocks with Beta’s of . 8 like Air Canada? How about 1000 stocks like Loblaws? 7. The annual rates of return on the Retirement Income Portfolio for Officers (RIP-OFF), a leading pension fund for police officers and on the TSX Index for the past few years are as follows: YearRIP-OFF(%)TSX (%) 19x218.211.4 19x314.210.1 19x48.7 9.3 19x5-22.5-12.1 19x60.6 2.1 19x779 35 a. Compute the...