Question
Problem 8-7 Portfolio required return Suppose you are the money manager of a $4.67 million investment fund. The fund consists of four stocks with the
Problem 8-7 Portfolio required return
Suppose you are the money manager of a $4.67 million investment fund. The fund consists of four stocks with the following investments and betas:
| Stock | Investment | Beta |
| A | $ 480,000 | 1.50 |
| B | 800,000 | - 0.50 |
| C | 1,140,000 | 1.25 |
| D | 2,250,000 | 0.75 |
If the market's required rate of return is 10% and the risk-free rate is 3%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal places. %
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The Oxford Handbook Of Computational Economics And Finance
Authors: Shu-Heng Chen, Mak Kaboudan, Ye-Rong Du
1st Edition
0199844372, 978-0199844371
