Tom O'Brien Has a 2-Stock Portfolio with a Total Value

question 32

Multiple Choice

Tom O'Brien has a 2-stock portfolio with a total value of $100,000.$65,000 is invested in Stock A with a beta of 0.75 and the remainder is invested in Stock B with a beta of 1.42.What is his portfolio's beta? Do not round your intermediate calculations.Round your final answer to 2 decimal places.

• A) 0.94
• B) 0.98
• C) 0.88
• D) 0.90
• E) 1.15

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Definitions:

Direct Investment

The acquisition of a controlling interest in a foreign business by means such as purchasing a company in the target country or expanding operations of an existing business in that country.