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You have just invested in a new portfolio of three stocks. The amount of money that you invested in each stock and its beta are
You have just invested in a new portfolio of three stocks. The amount of money that you invested in each stock and its beta are summarized below:
Stock. Investment. Beta
A. $186,000. 1.55
B. 279,000. .60
C. 465,000. 1.20
Caluclate the beta of the portfolio and use the Capital Asset Pricing Model (CAPM) to compute the expected rate of the return for the portfolio. Assume that the expected rate of return on the market is 13 percent and that the risk-free rate is 6 percent.
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Financial Management For Nurse Managers And Executives
Authors: Cheryl Jones, Steven A. Finkler, Christine T. Kovner
4th Edition
1455700886, 9781455700882
