Consider the Following Information on a Portfolio of Three Stocks

question 50

Multiple Choice

Consider the following information on a portfolio of three stocks: The portfolio is invested 35 percent in each A and B and 30 percent in C. If the expected T-bill rate is 3.90 percent, what is the expected risk premium on the portfolio?

• A) 6.19 percent
• B) 6.90 percent
• C) 7.38 percent
• D) 7.72 percent
• E) 8.68 percent

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