Q1.

Porter Inc's stock has an expected return of 11.00%, a beta of 1.25, and is in equilibrium. If the risk-free rate is 2.00%, what is the market risk premium? (Points : 0.71)

A.6.26% B.9.00% C.7.20% D.7.56% E.6.98%

Q2.Jim Angel holds a $200,000 portfolio consisting of the following stocks:

Stock	Investment	Beta
A	$50,000	0.80
B	$50,000	0.80
C	$50,000	1.00
D	$50,000	1.20
Total	$200,000

What is the portfolio's beta? (Points : 0.71)

A.0.732 B.0.817 C.0.798 D.0.950 E.1.083