Calculate the required rate of return on a stock that has a


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Q1: Calculate the standard deviation for an investment with four possible outcomes:

10% chance of losing 5%

30% chance of gaining 15%

40% chance of gaining 25% and

20% chance of gaining 40%

Calculate the mean, variance, and standard deviation (Show your work)

Q2: Calculate the required rate of return on a stock that has a beta of 1.1 when the expected return on the market is 12% and the risk-free rate is 3%:

(Show your work)

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Financial Management: Calculate the required rate of return on a stock that has a
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