Question
a.The portfolio beta for your proposed investment portfolio is ___% (Round to three decimal places.) b. A 25% increase in the expected return on the
a.The portfolio beta for your proposed investment portfolio is ___% (Round to three decimal places.)
b. A 25% increase in the expected return on the market will cause the expected return of your portfolio to _______ by ___% (Select from the drop-down menu and round the answer to two decimal places.)
c. A 25% decrease in the expected return on the market will have the following impact on the expected return on each asset:
Asset A would ______by ___%. (Select from the drop-down menu and round the answer to two decimal places.)
Asset B would ______by ___%(Select from the drop-down menu and round the answer to two decimal places.)
Asset C would _____by___% by (Select from the drop-down menu and round the answer to two decimal places.)
Asset D would ____by__% by (Select from the drop-down menu and round the answer to two decimal places.)
d.If you are interested in decreasing the beta of your portfolio by changing your portfolio allocation in two stocks, which stock would you decrease and which would you increase? Why?(Select the best choice below.)
You should increase asset A and decrease asset D because asset D's beta is negative and asset A has the highest beta.
You should increase asset B and decrease asset C because asset B' beta is close to 1 and asset C's beta is the closest to zero.
C. You should decrease asset D and increase asset A because asset D's beta is negative and asset A has the highest beta.
You should increase asset D and decrease asset A because asset D's beta is negative and asset A has the highest beta.
(Click on the icon in order to copy its contents into a spreadsheet.) a. What is the portfolio beta for your proposed investment portfolio? b. How would a 25 percent increase in the expected return on the market impact the expected return of your portfolio? c. How would a 25 percent decrease in the expected return on the market impact the expected return on each asset? d. If you are interested in decreasing the beta of your portfolio by changing your portfolio allocation in two stocks, which stock would you decrease and which would you increase? Why
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