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# STATS Problems with Solution

Question # 00013427
Subject: Statistics
Due on: 05/12/2014
Posted On: 04/25/2014 04:49 AM

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Which is the standard deviation of the returns on Stock A from 2000 to 2009 closest to?
Year End Stock A Realized Return (R - R) (R - R)2
2000 46.3% 29.85% 0.0891023
2001 26.7% 10.25% 0.0105063
2002 86.9% 70.45% 0.4963203
2003 23.1% 6.65% 0.0044223
2004 0.2% -16.25% 0.0264063
2005 -3.2% -19.65% 0.0386123
2006 -27.0% -43.45% 0.1887903
2007 27.9% 11.45% 0.0131103
2008 -5.1% -21.55% 0.0464403
2009 -11.3% -27.75% 0.0770063
A) 33.2%
B) 16.4%
C) 31.5%
D) 11.0%

Your firm is planning to invest in a new generation system. Galt industries is an all equity firm that specializes in the business. Suppose Galt's equity beta is 0.75, the risk-free rate is 3%, and the market risk premium is 6%. If your firm's project is all equity financed, then which is your estimate of your cost of capital closet to?

a) 5.25%

b)6.00%

c)6.75%

d)7.50%

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#### STATS Problems with Solution

Tutorial # 00012995
Posted On: 04/25/2014 04:53 AM
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Preview: = x 01100797)^(1/2) x 332 or xx 2%Your firm xx planning xx xxxxxx in x new generation xxxxxx Galt industries xx an.....
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