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Your retirement portfolio consists of 10 different common stocks that are each worth $1,500.The beta of the portfolio is 1.5.You decide to sell one stock
Your retirement portfolio consists of 10 different common stocks that are each worth
$1,500.The beta of the portfolio is 1.5.You decide to sell one stock that has a beta of 1.3.You then will take the proceeds and buy another stock that has a beta of 1.7.Upon buying this new stock that will change the beta of your portfolio.After buying the new stock, how much does the beta of the portfolio change? (Hint: Find the new portfolio beta)
a.0.13
b.0.20
c.0.32
d.0.04
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