Warren Has a Portfolio with Three Stocks as Shown in the Table

question 88

Multiple Choice

Warren has a portfolio with three stocks as shown in the table. What is the beta of Warren's portfolio? $$\begin{array} { | c | c | c | c | } \hline \text { Stock } & \begin{array} { c } \text { Required } \\\text { Return }\end{array} & \begin{array} { c } \text { Portfolio } \\\text { Weight }\end{array} & \text { Beta } \\\hline \text { Raymond's } & 6.75 \% & 0.4 & 0.50 \\\hline \begin{array} { c } \text { Keller } \\\text { Industries }\end{array} & 11.43 \% & 0.35 & 1.50 \\\hline \text { Huron Power } & 9.27 \% & 0.25 & 1.05 \\\hline\end{array}$$

• A)0.775
• B)0.988
• C)1.017
• D)1.340
• E)1.505

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