An Investor Expects a Return of 18% on His Portfolio

question 86

Multiple Choice

An investor expects a return of 18% on his portfolio with a beta of 1.25.If the expected market risk premium increases from 8% to 10%,what return should he now expect on the portfolio?

• A) 20.0%
• B) 20.5%
• C) 22.5%
• D) 26.0%

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