Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 01, 2024

A $5,000 portfolio is invested in three stocks and one risk-free asset. Nine hundred dollars is invested in stock A which has a beta of

A $5,000 portfolio is invested in three stocks and one risk-free asset. Nine hundred dollars is invested in stock A which has a beta of 0.75. One thousand dollars is invested in Stock B which has a beta of 1.25. The rest of the portfolio is divided evenly between stock C and the risk-free asset. What is the beta of stock C if the portfolio is equally as risky as the market?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

Step: 3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting and Reporting a Global Perspective

Authors: Michel Lebas, Herve Stolowy, Yuan Ding

4th edition

978-1408076866

Students also viewed these Finance questions

Question

Discussion: Imagine that you conduct a t-test and the p value is .02. How could you explain what this p value means to someone who is not already familiar with null hypothesis testing? Be sure to...

Answered: 1 week ago

Question

★★★★★

If researchers know that consumers in various geographic regions respond quite differently to a product category, such as tomato sauce, is area sampling appropriate? Why or why not?

Answered: 1 week ago

Question

★★★★★

In 2024, CPS Company changed its method of valuing inventory from the FIFO method to the average c 2023. CPS's inventories were $45 million (FIFO). CPS's records indicated that the inventories would...

Answered: 1 week ago

Question

★★★★★

Keri & Nick Consulting's partners' equity accounts reflected the following balances on August 31, 2020: Keri teo, Capital Nick Kalpakian, Capital $ 54,000 198.000 Lee and Kalpakian share...

Answered: 1 week ago

Question

★★★★★

Economic Order Quantity Self- Quiz Problem P=$5 D=20,000 O=$10 I=10% H= $.75 The hospital has only $90,000 budgeted for the product. What is the new price the hospital must negotiate with the vendor...

Answered: 1 week ago

Question

★★★★★

*Remember to read at least 50% of your classmates posts. 1. Use inference* to identify the possible strengths of the family. 2. Use inference* to identify the possible challenges of the family. 3....

Answered: 1 week ago

Question

★★★★★

A catalog company that receives the majority of its orders by telephone conducted a study to determine how long customers were willing to wait on hold before ordering a product. The length of time...

Answered: 1 week ago

Question

★★★★★

Setting the objective You need to decide which model to manufacture. What do you ultimately need to find out before taking this decision? Which model is likely to sell more? Which model has a higher...

Answered: 1 week ago

Question

★★★★★

4. Compute gross profit earned by the company for each of the four costing methods. For specific identification, units sold include 130 units from beginning inventory, 260 units from the March 5...

Answered: 1 week ago

Previous Question Next Question