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What Is the Standard Deviation of the Market Portfolio If

question 9

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What is the standard deviation of the market portfolio if the standard deviation of a fully diversified portfolio with a beta of 1.25 equals 20%?


Definitions:

Subscription Price

The price at which existing shareholders can purchase additional shares in a rights offering.

Subscription Price

The price at which existing shareholders can purchase new shares of a company before the shares are offered to the public.

Rights Offering

A financial mechanism wherein a company offers its existing shareholders the opportunity to buy additional shares directly from the company at a discounted price, before the company offers it to the general public.

Stock Price

The cost of purchasing a share of ownership in a company, fluctuating based on supply and demand in the stock market.

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