Reference no: EM131950983

1. Jane's portfolio has 3 stocks. A has an expected return of 7%, stock B has an expected return of 5%, and the expected returns for C is 10%. What is the expected portfolio return if she invested 40% of his money in stock A, 20% in stock B, and 40% in stock C?

2. Use the Sharpe ratio to determine which one of the following investments offers the best risk-return relationship. The risk free rate is 4%.

                  A                                B C

Expected return:               15%                            13% 12%

Standard deviation:           6%                             8% 9%

3.Anna bought a stock for $350. It is now worth $500. What return did she earn on her investment?

4.Naomi Corporation just purschased machinery at a cost of $3,300. Management expects the machinery to produce cash flows of $970, $1,150, and $18,000 over the next 3 years. What is the payback period?

5.A firm's bonds have a maturity of 5 years with a 1,000 face value, 5% coupon rate and currently sell at a price of 1,090. What is the yield to maturity if interest is paid semiannually?