Question
Rick has $10,000 to invest in a portfolio between Apple and IBM. The portfolio invests 75% of its money in Apple and the rest in
Rick has $10,000 to invest in a portfolio between Apple and IBM. The portfolio invests 75% of its money in Apple and the rest in IBM. The risk-free interest rate is 4% and the return on the market portfolio is 11%. The beta of Apple is 1.2 and the beta of IBM is 0.8. What is the expected return on the portfolio?
Group of answer choices
7.875%
16.1%
11.35%
11.7%
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Forecasting And Predictive Analytics With Forecast X
Authors: Barry Keating, J. Holton Wilson, John Solutions Inc.
7th International Edition
1260085236, 9781260085235
