Principles of Finance Question

Question 2 a. You are holding a portfolio made up of the following stocks: Stock A Stock B Stock C Investment value (in RM) 2,000 5,000 3,000 Beta 1.5 1.2 0.80 If the market' expected rate of return is 15%, and the risk-free rate is 4%, calculate the expected rate of return on this portfolio. b. Compute the expected rate of return on Hijau Berhad's common stock, given the information that Hijau Berhad common stock has a beta of 1.3, and the expected risk-free rate is 4% and the market risk premium is 12%. c. Merah Berhad's common stock has a beta of 1.8. If the expected risk-free rate is 5% and the expected return on the market is 16%, what is the expected rate of return on Merah's stock