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Dear Professor Kaltofen!

Hopefully you are doing well!

I started preparation to the Final Exam and completed about 70% of Mock Exam.
Could you please check if my solutions are correct and help with the rest of them?

I left some comments after screenshot of each task, please see that in the Word
document attached.

I did not include Task 6, as we already discussed that in the class.

Kind regards,
Dana Kazenova.

Dear Ms Kazenova,

here are my comments:

Task 1:
a) correct.
b) As we defined total risk sigma, apply this approach here. Sigma is 15 % here.
c) Systematic Risk is measured via Beta. It is 3 here.
d) correct.
e) RoTA is -840 : 3,000 = -28 %.
f) The question is in the return on equity, which is -90 % here.
g) Note the financial leverage formula, put in all the numbers and get (as in f)) -90 %.

Task 2:
a) and b) The numbers are corerct. However, a) does not show clearly, where E(R_M) = 20 % comes from.

Task 3:
a) Correct. Please mind that is should read "15 %" rather than just "15".
b) Sigma_A is 57.5 %. Please fill all asset shares with the numbers from a) and mind to apply the square root from your formula to get sigma.

Task 4:
a) ./.
b) correct.

Task 5:
a) and b) correct.
c) w_A* is 0.378 and w_B* is 0.622
For the rest please check your notes, as this is a task from the script, see page 53.

Kind regards
Prof. Dr. Daniel Kaltofen