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A bond portfolio has total assets of $133 million, of which 43% is financed with borrowed funds at a cost of 4.55%. If the assets

A bond portfolio has total assets of $133 million, of which 43% is financed with borrowed funds at a cost of 4.55%. If the assets generate a return of 3.48%, what is the portfolio's return on equity?

Correct Answer: 2.67

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