Question: Consider the same information from the previous question: ABC Corporation: Expected Return = 15.60%, Beta = 1.8 XYZ Corporation: Expected Return = 9.09%, Beta =

Consider the same information from the previous question:

ABC Corporation: Expected Return = 15.60%, Beta = 1.8

XYZ Corporation: Expected Return = 9.09%, Beta = 0.96

Assume that both assets are priced correctly according to CAPM.

Suppose that you would like to combine the assets into a portfolio with a Beta equal to 1.4

What is the expected return of the portfolio?

Please explain step by step, I will thumbs up. Thanks.

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