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A portfolio has an expected return of 12.5%. The portfolio consists of stock A with an expected return of 7% and stock B with a
A portfolio has an expected return of 12.5%. The portfolio consists of stock A with an expected return of 7% and stock B with a beta of 1.28. The risk-free rate of return is 3% and the market risk premium is 8%. What is the portfolio weight of Stock A?
A) 12%
B) 22%
C) 24%
D) 30%
E) 36%
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