Assume the risk-free rate (r_RF) is 4 percent and the required return on the market portfolio (r_M) is 10% plus the last one digit of your PSU ID number. Please write your PSU ID number at the first line of your answer.

Stock	Amount invested	Beta ()	Expected Return
1	$40,000	1.00	12%
2	$25,000	0.75	13%
3	$25,000	1.50	15%

Part a, Find the expected return for the portfolio. Hint: Expected return is a weighted average return. (5 points)

Part b, Using the same information above, find the beta for the portfolio. Hint: Portfolio beta is a weighted average beta (5 points)

Part c. Using the same information above, find the required rate of return for the portfolio. Hint: the required rate of return of a stock based portfolio is based on