Question
You are holding a portfolio with the following investments and betas: Stock Dollar investment Beta A $200,000 1.35 B 200,000 1.60 C 400,000 0.85 D
You are holding a portfolio with the following investments and betas:
| Stock | Dollar investment | Beta | ||
| A | $200,000 | 1.35 | ||
| B | 200,000 | 1.60 | ||
| C | 400,000 | 0.85 | ||
| D | 200,000 | -0.20 | ||
| Total investment | $1,000,000 | |||
The market's required return is 11% and the risk-free rate is 4%. What is the portfolio's required return? Do not round intermediate calculations. Round your answer to three decimal places.
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy
10th Canadian Edition Volume 2
1118300858, 978-1118300855
