Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I have 2 separate beta related questions I am unsure how to solve. 1. You invest 66%, 12%, and 22% of your wealth into a

I have 2 separate beta related questions I am unsure how to solve.

1. You invest 66%, 12%, and 22% of your wealth into a stock, the market, and a risk-free asset, respectively. The beta of the stock is 0.9. What is the beta of the portfolio? (round answer to 3 decimal places)

2. Given a risk-free rate of 2.1%, a market risk premium of 8.7%, and an expected return of 17.4%, what is the beta of this stock? (round answer to 3 decimal places)

Thank you!

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Focus On Personal Finance

Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes

2nd Edition

0073530638, 9780073530635

More Books

Students also viewed these Finance questions