You are managing a portfolio of 10 stocks that are held in equal amounts. The current beta of the portfolio is 1.54. Stock A (beta = 2.0) and Stock B (beta = 1.4) are among the 10 stocks held. When both of these stocks are sold, one additional stock is purchased using all of the freed up funds (no transaction costs). What would the beta of the replacement stock have to be to produce a new portfolio beta of 1.46?

ANS: b) 1.3

*I know the answer, I just need the worked out solution

thank you!!

10. You are managing a portfolio of 10 stocks that are held in equal amounts. The current beta of the portfolio is 1.54. Stock A (beta = 2.0) and Stock B (beta = 1.4) are among the 10 stocks held. When both of these stocks are sold, one additional stock is purchased using all of the freed up funds (no transaction costs). What would the beta of the replacement stock have to be to produce a new portfolio beta of 1.46? eese 1.5 1.3 1.2 1.0