A Portfolio Contains Four Assets

question 45

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, the expected return on the portfolio and the market?

• A) 1.19; 6.57%; 6.00%
• B) 1.19; 7.14%; 6.00%
• C) 1.19; 10.14%; 9.00%
• D) 1.25; 10.50%; 6.00%
• E) 1.25; 10.50%; 9.00%

---

Definitions:

Antibody Formation

The process by which the immune system produces antibodies in response to foreign substances (antigens) to neutralize or eliminate them.

Nonspecific Defenses

Nonspecific defenses refer to the innate immune response mechanisms that provide a general protection against pathogens, without targeting specific ones.

Immune Response

The reaction of the immune system to foreign substances, such as pathogens or vaccines, to protect the body.

Benign

A noncancerous or non-malignant growth or condition.