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a.)A portfolio consists of four assets in equal weights. Asset 1 has a beta of 0.90. Asset 2 has a beta of 1.00. Asset 3
a.)A portfolio consists of four assets in equal weights. Asset 1 has a beta of 0.90. Asset 2 has a beta of 1.00. Asset 3 has a beta of 1.40. Asset 4 has a beta of 1.10. If the portfolio's required return is 7.50% and the risk-free rate is 3.60%, what is Asset 2's required return?
b.) Suppose the risk-free rate is 5.90% and the market portfolio has an expected return of 15.75%. A portfolio is invested equally in three securities with betas of 0.83, 1.58, and 1.63 respectively. What is the expected return on this portfolio?
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