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14. Mr. Zahid has inherited the following portfolio: (2+1 = 3 marks) Share Share price No. of shares Beta ABC OMR 1.40 20000 0.80 DEF

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14. Mr. Zahid has inherited the following portfolio: (2+1 = 3 marks) Share Share price No. of shares Beta ABC OMR 1.40 20000 0.80 DEF OMR 2.20 10000 GHI OMR 1.90 20000 1.10 1.20 a). What is the beta on this portfolio? ( 2 marks) b). If the risk-free rate of return is 7.5 per cent and the risk premium on shares over Treasury bills has been 4 per cent what is the expected return on this portfolio over the next year? ( 1 mark)

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