Tom Noel holds the following portfolio: Stock Investment Beta A $150,000 1.40 B $50,000 0.80 $100,000 1.00 D $75,000 1.20 Total $375,000 Tom plans to sell Stock A and replace it with Stock E, which has a beta of 0.97. By how much will the portfolio beta change? -0.205 -0.146 -0.172 -0.129 -0.182 Tom O'Brien has a 2-stock portfolio with a total value of $100,000 $75,000 is invested in Stock A with a beta of 0.75 and the remainder is invested in Stock B with a beta of 1.42. What is his portfolio's beta? 0.99 1.12 0.86 0.92 0.81 You have the following data on (1) the average annual returns of the market for the past 5 years and (2) similar information on Stocks A and B. Which of the possible answers best describes the historical betas for A and B? Years 1 2 Market 0.03 -0.05 0.01 -0.10 0.06 Stock A 0.16 0.20 0.18 0.25 0.14 Stock B 0.05 0.05 0.05 0.05 0.05 3 4 5 b 0; bB = 1 bA=0; bB = -1 DA > +1; B=0 BAC-1; B=1