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5. (a) Amy has $50,000 invested in a stock with a beta of 0.7 and another $70,000 invested in a stock with a beta of
5. (a) Amy has $50,000 invested in a stock with a beta of 0.7 and another $70,000 invested in a stock with a beta of 1.7. If these are the only two investments in her portfolio, what is her portfolios beta? (b) Suppose, the 3-month t-bill rate is currently 4% and the expected return on the market portfolio is 10%. What is the required return on Amys portfolio of these two stocks?
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