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Securities A, B, and C have the following characteristics: Security Expected Return % Beta A 10 0.7 B 14 1.2 C 20 1.8 (a) What

Securities A, B, and C have the following characteristics:

Security Expected Return % Beta
A 10 0.7
B 14 1.2
C 20 1.8

(a) What is the expected return on a portfolio with equal weights?

(b) What is the beta of a portfolio with equal weights?

(c) Are the three securities priced correctly according to the capital asset pricing model?

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