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You want your portfolio beta to be 1.20. You have $800 to invest and want to divide it between an asset with a beta of
You want your portfolio beta to be 1.20. You have $800 to invest and want to divide it between an asset with a beta of 1.6 and a risk-free asset. How much should you invest in the risk-free asset?
(The answer is 200, please show correct math and steps to arrive at answer. Thank you)
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