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Please show the steps to get the right answers. Thank you! Show all attempts Jar Jar forms an aggressive growth portfolio by investing 20% of
Please show the steps to get the right answers. Thank you!
Show all attempts Jar Jar forms an aggressive growth portfolio by investing 20% of his savings in Ford stock, 23% in Toyota stock, 24% in Kia stock, 10% in an index fund, and the last 23% is allocated on a bond fund. Assume for simplicity that the index fund is a good proxy to the market portfolio and has a beta equal to 1, whereas the bond fund is a good proxy to the riskless asset. The beta of Ford stock is 1.18, the beta of Toyota is 1.41, and the beta of Kia is 1.81. If the expected return of the market index is 10% and the risk-free asset yields 7%, what are the beta and the expected return of Jar Jar's portfolio? Give your answer rounded to two decimal places. What is the beta of the portfolio? Bp = Your response 10.28 3 Grade: 0/1.0 Correct response 1.09 0.0x1/1 = 0.00 Based on the value of Bp = 1.09, what is the expected return of Jar Jar's portfolio? Give your answer rounded to two decimal places. Ep) = Your response Correct response 122 10.27 * Grade: 0/1.0 0.0x1/1 = 0.00Step by Step Solution
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