Question
Asset W has an expected return of 12.0 percent and a beta of 1.25. If the risk-free rate is 3.5 percent, complete the following table
Asset W has an expected return of 12.0 percent and a beta of 1.25. If the risk-free rate is 3.5 percent, complete the following table for portfolios of Asset W and a risk-free asset. (Don't round intermediate calculations. Enter portfolio expected return answers as a percentage rounded to 2 decimal places. Round the beta answers to 3 decimal places.
Percentage of Portfolio In Asset W Portfolio Expected Return Portfolio Beta
0% ?% ?
25 ?% ?
50 ?% ?
75 ?% ?
100 ?% ?
125 ?% ?
150 ?% ?
If you plot the relationship between portfolio expected return and portfolio beta, what is the slope of the line that results? (Enter your answer as a percent rounded to 2 decimal places.)
Slope of the Line ?%
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