Question

The following​ table, chart contains beta coefficient estimates for six firms. Calculate the expected increase in the value of each​ firm's shares if the market portfolio were to increase by 10 percent. Perform the same calculation where the market drops by 10 percent. Which set of firms has the most variable or volatile stock​ returns? (chart below)

Input the expected increase in the value of each​ firm's shares if the market portfolio were to increase by​ 10%.  ​(Round each answer to two decimal​ places.) (chart below)

Company	Microsoft Money Central (MSN.com) Beta Estimate	Expected Increase
Computers and Software
Apple Inc.​ (AAPL)	2.64	____​%
Dell Inc.​ (DELL)	1.56	_____​%
Hewlett Packard​ (HPQ)	1.25	____​%
Utilities
American Electric Power Co.​ (AEP)	0.63	_____%
Duke Energy Corp.​ (DUK)	0.42	____%
Centerpoint Energy​ (CNP)	0.95	_____​%

Answer 1

Input the expected increase in the value of each​ firm's shares if the market portfolio were to increase by​ 10%.

1.
=26.40%
2.
=15.60%
3.
=12.50%
4.
=6.30%
5.
=4.20%
6.
=9.50%

Input the expected increase in the value of each​ firm's shares if the market portfolio were to decrease by​ 10%.

1.
=-26.40%
2.
=-15.60%
3.
=-12.50%
4.
=-6.30%
5.
=-4.20%
6.
=-9.50%

Which set of firms has the most variable or volatile stock​ returns?
Computers and software firms has the most variable or volatile stock​ returns