12. Suppose you held a diversified portfolio consisting of 10 different common stocks, investing $500 in each stock. The portfolio's beta is 1.9. Now suppose you decided to sell one of the stocks in your portfolio with a beta of 0.8 for $500 and use the proceeds to buy another stock with a beta of 1.25. What would your portfolio's new beta be? O a) 3.865 Ob) 1.074 O c) 2.025 O d d) 4.2 O e) None of the above 13. Your brother is about to retire, and he wants to buy an annuity that will provide him with $85,000 of income a year for 25 years, with the first payment coming immediately. The going rate on such annuities is 15%. How much would it cost him to buy the annuity today? * a. $1,063,968 O b. $1,119,966 O c. $1,178,912 d. $1,240,960 e. None of the above