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You own a portfolio with shares in four companies: Pfizer, Walgreens, JP Morgan, and 3M. Information on each company's common stock is shown in the

You own a portfolio with shares in four companies: Pfizer, Walgreens, JP Morgan, and 3M. Information on each company's common stock is shown in the table below. Assume that the current yield on one-year T-Bills in the U.S. is 4.96%, and that the overall return of the U.S. stock market is currently 14.25%. Given this information, calculate the CAPM for each stock. Then, calculate the portfolio's beta. Finally, calculate the portfolio's expected return.

Stock

Share Price

Beta

# Shares Owned

Pfizer

36.81

1.95

440

Walgreens

44.50

2.25

910

JP Morgan

95.18

2.10

235

3M

146.46

0.74

550

INSTRUCTIONS: Write dollar amounts out to the penny, with no dollar sign: 1000.00. All interest rates should be entered as follows: 11.28 (no percent sign).

For this problem:

Pfizer expected return =

Walgreens expected return =

JP Morgan expected return =

3M expected return =

Portfolio Beta =

Portfolio Return =

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