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Suppose you hold a portfolio that consists of 35% Microsoft stock, 35% Treasury bills, and 30% GE stock. Microsoft's beta is 1 and GE's beta

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Suppose you hold a portfolio that consists of 35% Microsoft stock, 35% Treasury bills, and 30% GE stock. Microsoft's beta is 1 and GE's beta is 0.5. Treasury bills (the risk-free asset) offer a return of 4% and the expected return on the market is 12%. According to the CAPM, what return should you expect on your portfolio? Previous Next

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