Question
Suppose you are the money manager of a $4.78 million investment fund. The fund consists of four stocks with the following investments and betas: Stock
Suppose you are the money manager of a $4.78 million investment fund. The fund consists of four stocks with the following investments and betas:
| Stock | Investment | Beta | ||
| A | $340,000 | 1.50 | ||
| B | 500,000 | (0.50) | ||
| C | 940,000 | 1.25 | ||
| D | 3,000,000 | 0.75 |
If the market's required rate of return is 13% and the risk-free rate is 5%, 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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Retail Management A Strategic Approach
Authors: Barry Berman, Joel Evans, Patrali Chatterjee
13th Edition
0133796841, 9780133796841
