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Consider the following information for the Alachua Retirement Fund, with a total investment of $6 million. Stock A B C D Total Investment $600,000 900,000
Consider the following information for the Alachua Retirement Fund, with a total investment of $6 million.
Stock A B C D Total | Investment $600,000 900,000 1,500,000 3,000,000 $6,000,000 | Beta 1.2 -0.4 1.5 0.8 |
The market required rate of return is 12 percent, and the risk-free rate is 6 percent. What is its required rate of return?
A. 8.98%
B. 9.45%
C. 10.50%
D. 11.56%
E. 11.01%
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