Question
Quantitative Problem: You are holding a portfolio with the following investments and betas: Stock Dollar investment Beta A $200,000 1.15 B 100,000 1.60 C 400,000
Quantitative Problem: You are holding a portfolio with the following investments and betas:
| Stock | Dollar investment | Beta | |||
| A | $200,000 | 1.15 | |||
| B | 100,000 | 1.60 | |||
| C | 400,000 | 0.70 | |||
| D | 300,000 | -0.15 | |||
| Total investment | $1,000,000 | ||||
The market's required return is 9% and the risk-free rate is 4%. What is the portfolio's required return? Do not round intermediate calculations. Round your answer to three decimal places.
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Financial Valuation Workbook
Authors: James Hitchner, Michael J. Mard
1st Edition
0471220833, 978-0471220831
