An Investor Has a Portfolio Comprised of Stock A, Which

question 321

Multiple Choice

An investor has a portfolio comprised of stock A, which has a beta of 1.4 and an expected return of 10%, and Treasury bills, which have an expected return of 4%. The portfolio has an expected return of 7.30%. What is the portfolio weight of stock A?

• A) 40%
• B) 45%
• C) 50%
• D) 55%
• E) 60%

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