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Modern Portfolio Managers (MPM) hold a 2.5 million dollar portfolio of stocks with a beta of .95 measured with respect to the S&P 500 index.

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Modern Portfolio Managers (MPM) hold a 2.5 million dollar portfolio of stocks with a beta of .95 measured with respect to the S&P 500 index. The current value of a futures contract on the index is 1109.3. The multiplier on the futures equals $250. If MPM wishes to increase its systematic risk in its portfolio to 1.75, how many contracts must it buy or sell? Sell 7.2116 Sell 1.4199 Buy 7.2116 Buy 354.98 Buy 15.776

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