Question
Question 9 (1 point) Stock X has a beta of 0.7 and Stock Y has a beta of 1.3. The standard deviation of each stocks
Question 9 (1 point)
Stock X has a beta of 0.7 and Stock Y has a beta of 1.3. The standard deviation of each stocks returns is 20%. The stocks returns are independent of each other, i.e., the correlation coefficient, r, between them is zero. Portfolio P consists of 50% X and 50% Y. Given this information, which of the following statements is correct?
Question 9 options:
| Portfolio P has the same required return as the market (rM). | |
| Portfolio P has a beta of 1.0 and a required return that is equal to the riskless rate, rRF. | |
| The required return on Portfolio P is equal to the market risk premium (rM rRF). | |
| Portfolio P has a beta of 0.7. |
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Personal Finance For Musicians
Authors: Bobby Borg
1st Edition
1538163306, 978-1538163306
