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Consider a portfolio consisting of the following three stocks. Stock Portfolio Weight Volatility (SD) Correlation with the market portfolio A 0.25 0.12 0.4 B 0.35

Consider a portfolio consisting of the following three stocks.

Stock Portfolio Weight Volatility (SD) Correlation with the market portfolio
A 0.25 0.12 0.4
B 0.35 0.25 0.6
C 0.4 0.13 0.5

The standard deviation of the market portfolio is 10%. The expected return of the market portfolio is 8%. The risk-free asset is 3%.

a. What is the beta and expected return of each stock?

b. What is the expected return of the portfolio?

c. What is the beta of the portfolio?

Please solve in Excel and SHOW WORK!

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