A Portfolio Contains Four Assets

question 4

Multiple Choice

A portfolio contains four assets.Asset 1 has a beta of .8 and composes 20% of the portfolio.Asset 2 has a beta of 1.1 and composes 20% of the portfolio.Asset 3 has a beta of 1.5 and composes 30% of the portfolio.Asset 4 has a beta of 1.6 and composes the remaining 30% 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)1.31

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