A Portfolio Is Characterized by the Following A Calculate the Portfolio's Expected Return

question 99

Essay

A portfolio is characterized by the following:
$\begin{array}{llll}\text { Stock } &\$ \text { 's invested }& \text { Expected Return } & \text { Beta } \\\hline \mathrm{X} & \$ 2,000 & 15 \% & 2 \\\mathrm{Y} & \$ 8,000 & 12 \% & 1.6 \\\mathrm{Z} & \$ 2,000 & 8 \% & 1.2\end{array}$
a. Calculate the portfolio's expected return.
b. Calculate the beta of the portfolio.
c. If the return on the market is 10% and the risk-free rate is 3%, what is the required return on the portfolio?

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