Question
Suppose in a hypothetical world, there are only two assets in the economy: Stock A and Stock B. Stock A has a beta of 1.2
Suppose in a hypothetical world, there are only two assets in the economy: Stock A and Stock B. Stock A has a beta of 1.2 and a total market value of $10 million. Stock B's return has a standard deviation of 0.06. There are 5 million shares of Stock B outstanding, with each share being sold at $12 per share.
What is Stock A's portfolio weight in the market portfolio?
What is Stock B's portfolio weight in the market portfolio?
What is Stock B's beta?
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Managerial Accounting
Authors: John Wild, Ken Shaw
5th edition
978-1259176494, 1259176495, 978-1259347641, 1259347648, 978-0078025600
