1. To set up a $15,000 portfolio, Yolanda Kettle can invest in Kroger, E(R) = 8.4%, and in Logitech, E(R) = 12%. How much will Yolanda allocate to Kroger if she wants her portfolio to have an E(R) = 9.9%?

• $5,468.75

• $8,750.00

• $8,333.33

• $8,020.83

• $6,250.00

2. The stock of Cleveland-Cliffs Inc. (Ticker: CLF) has a beta of 1.26 and an E(R) = 12.0%. In light of this information and knowing that U.S. T-Bills return 4%, Rm is equal to:

• 10.35

• 8.00

• 8.83

• 12.66

• 8.89