Mr. Aly has made following combination of investment in a stock market with the assigned beta value.

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Question:

Firms Rate of investment Beta

A 0.500 .80

B 0.101 .2

C 0.250 .3

D 0.151 .5

Required

a. Calculate portfolio beta value for Mr. Aly

b. Assume that the risk-free rate is 7% and that the market risk premium is 8%. What rate of return Mr. Aly expecting from his portfolio investment?

Related Book For answer-question

Accounting Principles

ISBN: 978-0470534793

10th Edition

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

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Posted Date: Oct 15, 2020 01:02 PM

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Mr. Aly has made following combination of investment in a stock market with the assigned beta value.

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a Portfolio Beta Value Of Mr Aly Firms Rate of investment Be... View the full answer

Accounting Principles

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