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The expected return on the market portfolio is 0.12, and the current T-Bill rate is 0.02. Stock A has a beta of 0.73 and volatility
The expected return on the market portfolio is 0.12, and the current T-Bill rate is 0.02. Stock A has a beta of 0.73 and volatility of 0.86. Stock B has a beta of 1.14 and volatility of 0.70. According to the CAPM, what is the expected return of a portfolio consisting of $11,000 in Stock A and $7,000 in Stock B? Enter your answer as a decimal and show 4 decimal places. For example, if your answer is 9.55%, enter .0955.
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