Q 1. PWC ltd. has evaluated two projects and the following information is available to the company:
|Particular||Project A||Project B|
Q 2. The risk-free return in the market is 6%. An investment option is available that pays 12% with a probability of 40% and 2% with a probability of 60%. Will a risk averse investor invest in this portfolio?
Q 3. Mix Plants Ltd. common stock has a beta of 0.9. The risk-free rate is 6%, and the expected return on the market is 10%. Based on this information and the CAPM concept, what will be the required return on Mix Plants’ stock?