Question
Consider the following information: Portfolio Expected Return Beta Risk-free 5 % 0 Market 12.4 1.0 A 10.4 1.7 a. Calculate the the return predicted by
Consider the following information:
| Portfolio | Expected Return | Beta | |
| Risk-free | 5 | % | 0 |
| Market | 12.4 | 1.0 | |
| A | 10.4 | 1.7 | |
a. Calculate the the return predicted by CAPM for a portfolio with a beta of 1.7. (Round your answer to 2 decimal places.)
Return %
b. What isthe alpha of portfolio A. (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.)
Alpha %
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Personal Finance
Authors: Jeff Madura, Hardeep Singh Gill
4th Canadian edition
134724712, 134724713, 9780134779782 , 978-0134724713
