Question-2

An investment advisor has recommended a $100,000 portfolio containing four assets: (1) Asset B, (2) Asset D, (3) a risk-free asset, and (4) a market portfolio. $20,000 will be invested in Asset B, with a beta of 1.5; $25,000 will be invested in Asset D, with a beta of 2.0; $25,000 will be invested in the risk-free asset, and $30,000 will be invested in the market portfolio. What is the beta of the Portfolio?

YOU MUST SHOW YOUR WORK.

YOU MUST ALSO SHOW CALCULATOR ENTRIES WHEN APPLICABLE.

FINAL ANSWER

The beta of the Portfolio