Question

Use the following data to explore the risk-return relation and the concept of beta for Apple...

Use the following data to explore the risk-return relation and the concept of beta for Apple stock, Alphabet (Google) stock, and the S&P 500 market index:

Year

Apple Stock Price

Alphabet Stock Price

S&P 500 Market Index

2017

$174.09

$1,072.01

2,601.42

2016

$115.82

$807.80

2,238.83

2015

$105.26             

$765.84

2,043.94

2014

$113.99

$521.51

2,058.90

2013

$80.01

$559.76

1,848.36

2012

$72.80

$358.17

1,426.19

Part 1: Risk and Beta

  1. Make a scatter plot of stock returns (y-axis) against market returns (x-axis) for both Apple and Alphabet stock in one plot. Add a linear trend line to the scatter plot for each stock and include the equation on the chart (Select data point and right click then select "add trendline" and choose a "linear" trend and select "display equation on chart"). Label the y-axis, x-axis, legend, and chart title (9 Points)
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