3. define risk and investment risk. describe standard deviation and the coefficient of variation and how they are used to develop a measure of risk for a stock. the average stock in the s& p 500 has a standard deviation in ror of 22% and a mean ror of 12%. another stock, a publicly-traded venture capital stock, vc inc., has a standard deviation in ror of 50% and a mean of 50%. which stock is riskier and explain your response using the statistics above. assuming a 12% rate of return on the stock market, a 4% risk-free rate of return, obtain the beta for the company that you analyzed in question set 1 from yahoo. interpret the beta. what would be that company’s cost of common equity based on your calculation?

Ultravision inc. anticipates sales of $280,000 from january through april. materials will represent 50 percent of sales, and because of level production, material purchases will be equal for each month during the four months of january, february, march, and april. materials are paid for one month after the month purchased. materials purchased in december of last year were $24,000 (half of $48,000 in sales). labor costs for each of the four months are slightly different due to a provision in the labor contract in which bonuses are paid in february and april. the labor figures are: january $14,000 february 17,000 march 14,000 april 19,000 fixed overhead is $10,000 per month. prepare a schedule of cash payments for january through april. (assume the $280,000 of sales occur equally over the four months of january through april, i.e. monthly sales = $280,000 / 4.)