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Question 14 (20 points) You decide to form a portfolio of the following amounts invested in the following stocks. Stock DM BM GM FM Amount

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Question 14 (20 points) You decide to form a portfolio of the following amounts invested in the following stocks. Stock DM BM GM FM Amount $2,000 $3,000 $1,000 $4,000 Beta Expected Return 1.6 11% 0.95 15% 0.75 16% 1.45 12% Blank #1: What is the expected return (in percentage) of the portfolio? Blank #2: What is the beta (B) of the portfolio? Blank #3: Using the CAPM, what is the expected return (in percentage) on BM stock given the risk-free rate is 5% and the market return is 13%? Blank #4: Is the stock in Blank #3 overpriced or underpriced

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