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Need the expected return of each stock. Expected return of a portfolio using beta. The beta of four stocksP, Q, R, and sare 0.55, 0.82,
Need the expected return of each stock.
Expected return of a portfolio using beta. The beta of four stocksP, Q, R, and sare 0.55, 0.82, 1.15, and 1.51, respectively and the beta of portfolio 1 is 1.01, the beta of portfolio 2 is 0.87, and the beta of portfolio 3 is 1.13. What are the expected returns of each of the four individual assets and the three portfolios if the current SML is plotted with an intercept of 5.0% (risk-free rate) and a market premium of 11.0% (slope of the line)? What is the expected return of stock P? % (Round to two decimal places.)Step by Step Solution
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