Question
Suppose you are the money manager of a $4.24 million investment fund. The fund consists of four stocks with the following investments and betas: Stock
Suppose you are the money manager of a $4.24 million investment fund. The fund consists of four stocks with the following investments and betas:
| Stock | Investment | Beta |
| A | $ 400,000 | 1.50 |
| B | 700,000 | (0.50) |
| C | 1,140,000 | 1.25 |
| D | 2,000,000 | 0.75 |
If the market's required rate of return is 12% and the risk-free rate is 3%, 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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Entrepreneurial Finance And Accounting For High-Tech Companies
Authors: Frank J Fabozzi
1st Edition
0262336901, 9780262336901
