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You bought 200 shares of Dr Pepper Snapple Group at $70.67 per share, 100 shares of Home Depot at $111.72 per share, and 50 shares
You bought 200 shares of Dr Pepper Snapple Group at $70.67 per share, 100 shares of Home Depot at $111.72 per share, and 50 shares of Tesla Motors at $235.11 per share one year ago. Suppose that the financial data from the same period indicate that Dr Pepper Snapple Group, Inc. stock has a beta of -0.11, Home Depot, Inc. stock has a beta of 1.21, and Tesla Motors, Inc. stock has a beta of 1.4. The risk-free interest rate is 2% and the market risk premium is 6.7%.
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To calculate the beta of the portfolio we need to find the weighted average of the betas of the indi...
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Financial Accounting
Authors: Robert Libby, Patricia Libby, Daniel Short
8th edition
78025559, 978-0078025556
