You Want to Construct a Portfolio Containing Equal Amounts of U.S.Treasury

question 53

Multiple Choice

You want to construct a portfolio containing equal amounts of U.S.Treasury bills and two stocks.If the beta of the first stock is 1.23 and the beta of the portfolio is 1.0,what does the beta of the second stock have to be?

• A) 0.77
• B) 1.23
• C) 0.23
• D) 1.77

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Definitions:

Illinois Colonists

Refers to early settlers in Illinois during the period of American Frontier expansion, although "Illinois Colonists" might not be a widely recognized term.

Mississippi River Trade

This term refers to the economic activities and trade that historically took place along the Mississippi River, playing a crucial role in the development and growth of the United States, especially in the transportation of agricultural goods.

Natchez

A city in Mississippi known for its rich history and antebellum architecture.

French Colonial Control

The period of history when France established dominance over various regions across the globe, including parts of Africa, the Americas, and Asia, for economic, strategic, and colonization purposes.