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19)An investor is forming a portfolio by investing $50,000 in stock A that has a beta of 2.50, and $25,000 in stock B that has

19)An investor is forming a portfolio by investing $50,000 in stock A that has a beta of 2.50, and $25,000 in stock B that has a beta of 1.90. The return on the market is equal to 6 percent and Treasury bonds have a yield of 4 percent. What is the required rate of return on the investors portfolio? *

a) 6.6%

b) 6.8%

c) 5.8%

d) 7.0%

e) None of the above

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