FIN 350 Managerial Finance Mini-Cases

Managerial Finance

### Question Description

There are 3 different cases, if you scroll down you will see it. After each case I have provided the HINTS for the assignment.

If you have any other questions please let me know.

https://b-ok.org/dl/3413815/f88084

These are related to chapter 8, 10 and 12

Tags: FIN 350

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Case Study: ALLIANCE STOCK FUND ANALYSIS
1. What is the portfolio beta for each of the available stock funds?
Fund p
Bx * 0.3 + By *0.7
(0.5 * 0.3) + (0.9 * 0.7)
= 0.78
Fund q
(Bx * 0.33) + (By * 0.33) + (Bz * 0.33)
(0.5 * 0.33) + (0.9 * 0.33) + (0.14 * 0.33)
=0.93
2. What is the generic equation for the Security Market Line (SML) that would apply to all
publicly-traded stock shares, using the numerical values given for the risk-free rate (R F)
and the market average rate of return (r m) that are provided in the case study above?
Required return = risk free rate + Beta (market premium – risk free rate)
Risk return = variance (Y)
Risk free rate = constant ©
Beta = variable x
Market premium – risk free rate = constant M slope of SML
Y = C + XM

If Rf is 3.5 and R...

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