Joseph is reviewing his portfolio, which includes certain stocks and bonds. He has a large amount tied

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Joseph is reviewing his portfolio, which includes certain stocks and bonds. He has a large amount tied up in U.S. Treasury bills paying 2%. He is considering moving some of his funds from the T-bills into a stock. The stock has a beta of 1.10. If Joseph expects a return of 16% from the stock (a little better than the expected market return of 14%), should he buy the stock or leave his funds in the T-bill?

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Fundamentals Of Investing

ISBN: 9780135175217

14th Edition

Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk

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