Question
Suppose you manage a $6 million fund that consists of four stocks with the following investments: Stock Investment Beta A $300,000 1.50 B 600,000 -0.50
Suppose you manage a $6 million fund that consists of four stocks with the following investments:
| Stock | Investment | Beta | ||
| A | $300,000 | 1.50 | ||
| B | 600,000 | -0.50 | ||
| C | 900,000 | 1.25 | ||
| D | 4,200,000 | 0.75 | ||
If the market's required rate of return is 13% and the risk-free rate is 7%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal places.
%
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Contemporary Issues In Development Finance
Authors: Joshua Yindenaba Abor, Robert Lensink, Charles Komla Delali Adjasi
1st Edition
1138324329, 978-1138324329
