Question
Suppose you are the money manager of a $4.18 million investment fund. The fund consists of four stocks with the following investments and betas: Stock
Suppose you are the money manager of a $4.18 million investment fund. The fund consists of four stocks with the following investments and betas:
| Stock | Investment | Beta |
| A | $ 480,000 | 1.50 |
| B | 360,000 | (0.50) |
| C | 1,340,000 | 1.25 |
| D | 2,000,000 | 0.75 |
If the market's required rate of return is 13% and the risk-free rate is 4%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal places.
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Financial Shenanigans How To Detect Accounting Gimmicks And Fraud In Financial Reports
Authors: Howard M. Schilit, Jeremy Perler, Yoni Engelhart
4th Edition
126011726X, 9781260117264
