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A stock has a beta of 1.13 an as expected return of 12.1 percent. A risk-free asset currently earns 5 percent. a. what is the
A stock has a beta of 1.13 an as expected return of 12.1 percent. A risk-free asset currently earns 5 percent.
a. what is the expected return on a portfolio that is equally invested in the two assets?
b.If a portfolio of the two assets has a beta of .50, what are the portfolio weights?
c.If a portfolio of the two assets has an expected return of 10 percent, what is it's beta?
d. If a portfolio of the two assets has a beta of 2.26 what are the portfolio weights?
How do you interpret the weights for the two assets in this case? explain
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