7). Mr. Ahmed has inherited the following portfolio: Share No. of Shares Beta Share Price Star plc 22.876 0.65 $1.25 Moon plc 19,809 1.45 $2.75 Sun plc 35,291 1.12 $1.95 a. What is the beta of this portfolio? b. If the risk-free rate of return is 6.5 per cent and the risk premium on shares over the Treasury bills has been 5 per cent what is the expected return on this portfolio over the next year? 8). The returns on shares of S and T vary depending on the state of the economic growth. State of economy Probability of Returns on Sif Returns on T if Economic state cconomic state occurs economic state occurs occurring (%) Recession 0.15 17 Growth 0.70 19 Boom 0.15 20 (%) -9 18 40