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A stock has a beta of 1.5, an expected return of 15%, and lies on the security market line. A risk-free asset is yielding 3%.
A stock has a beta of 1.5, an expected return of 15%, and lies on the security market line. A risk-free asset is yielding 3%. You want to create a $10,000 portfolio consisting of Stock A and the risk-free security such that the portfolio beta is 75. What rate of return should you expect to earn on your portfolio? 8 percent 9 percent 10 percent 11 percent 12 percent Stock J has a beta of 1.5 and an expected return of 15%, while Stock K has a beta of 75 and an expected return of 9%. You want a portfolio with the same risk as the market. What is the expected return of your portfolio? 10 percent 11 percent 12 percent 13 percent 14 percent
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