You Invest 55% of Your Money in Security a with a Beta

question 67

Multiple Choice

You invest 55% of your money in security A with a beta of 1.4 and the rest of your money in security B with a beta of 0.9. The beta of the resulting portfolio is

• A) 1.466.
• B) 1.157.
• C) 0.968.
• D) 1.082.
• E) 1.175.

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Definitions:

Improper Fractions

Fractions in which the numerator is at least as large as the denominator.

Lowest Terms

The most reduced form of a fraction, where the numerator and denominator are the smallest whole numbers possible.

Mixed Numbers

Numbers consisting of an integer and a proper fraction, representing sums of whole numbers and fractions.

Improper Fractions

Fractions where the numerator is greater than or equal to the denominator, representing a value of one or more.