A Portfolio Contains Four Assets

question 65

Multiple Choice

A portfolio contains four assets.Asset 1 has a beta of .8 and comprises 30% of the portfolio.Asset 2 has a beta of 1.1 and comprises 30% of the portfolio.Asset 3 has a beta of 1.5 and comprises 20% of
The portfolio.Asset 4 has a beta of 1.6 and comprises the remaining 20% of the portfolio.If the
Riskless rate is expected to be 3% and the market risk premium is 6%, what is the beta of the
Portfolio?

• A)0.80
• B)1.10
• C)1.19
• D)1.25
• E)1.40

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Definitions:

Elect

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Damned

Generally refers to something that is condemned, often used in religious contexts to refer to those believed to be condemned by a deity to suffer eternal punishment.

Contract with God

Often considered one of the earliest graphic novels, created by Will Eisner, depicting the lives of Jewish characters in New York City.