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Important note: Please Write by microsoft word (text). Q5. Mr. Gill has inherited the following portfolio: I 1 Share Share price No. of shares Beta

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Q5. Mr. Gill has inherited the following portfolio: I 1 Share Share price No. of shares Beta ABCple 1.50 20,000 0.70 DEEplc 2.50 10,000 1.20 GHIpc 1.80 20,000 1.10 What is the beta on this portfolio? b. If the risk free rate of return is 7.5 per cent and the risk premium on shares over Treasury bills has been 6 per cent what is the expected return on this portfolio over the next year? Q6. Discuss the main assumptions of CAPM theory and list its practical problems. a

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