Martin Ortner Holds a $200,000 Portfolio Consisting of the Following

question 115

Multiple Choice

Martin Ortner holds a $200,000 portfolio consisting of the following stocks:



$\begin{array}{lccc}\text { Stock} & \text { Investment}& \text { Beta} \\\mathrm{A} & \$ 50,000 &0.95\\\mathrm{B} & 50,000 &0.80\\\mathrm{C} & 50,000&1.00 \\\mathrm{D} & 50,000&1.20 \\\text { Total }& \$ 200,000\end{array}$

What is the portfolio's beta?

• A) 0.938
• B) 0.988
• C) 1.037
• D) 1.089
• E) 1.143

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Definitions:

Investors Rate of Return

The percentage of return investors expect to earn on their investment, considering both the income and the appreciation of the investment.

Annual Dividend

The total dividend payments made to shareholders in a year, typically expressed per share.

Rate of Return

The enhancement or reduction in worth of an investment across a specific duration, measured as a proportion of the investment's original cost.

First Dividends

The initial distribution of earnings paid to shareholders by a corporation that has just begun paying dividends.