Question: I just need help with part B everything else is correct! Thanks in advance!! :) A stock has a beta of 1.50 and an expected

I just need help with part B everything else is correct! Thanks in advance!! :)

A stock has a beta of 1.50 and an expected return of 14 percent. A risk-free asset currently earns 2 percent. a. What is the expected return on a portfolio that is equally invested in the two assets? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. If a portfolio of the two assets has a beta of.84, what are the portfolio weights? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., .1616.) c. If a portfolio of the two assets has an expected return of 9 percent, what is its beta? (Do not round intermediate calculations. Round your answer to 3 decimal places, e.g., 32.161.) d. If a portfolio of the two assets has a beta of 3.00, what are the portfolio weights? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.) a. 8.00% Expected return b. Weight of stock Weight of risk-free C. Portfolio beta 0.875 2 d. Weight of stock Weight of risk-free -1

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

JUST NEED PART E, EVERYTHING ELSE IS CORRECT! Alpha Corporation and Beta Corporation are identical in every way except their capital structures. Alpha Corporation, an all-equity firm, has 20,000...

I need help with the blanks please. Everything else is correct. Thanks! Problem 14-8 Rent'R Cars is a multisite car rental company in the city. It is trying out a new "return the car to the location...

JUST NEED PART C, EVERYTHING ELSE IS CORRECT! Acetate, Inc., has equity with a market value of $23.9 million and debt with a market value of $7.17 million. Treasury bills that mature in one year...

I need help on questions 12-15 in section 5. Could you also explain how you solved them 1 Sample Questions from Previous FIN 3310 Departmental Final Exams (Revised 2015) Printed below is a sampling...

MGMT 640 Midterm Exam Ques. 1) Which of the following is not an advantage of the corporate form of business organization? a. Sell debt or equity in public capital markets b. Owners have limited...

midterm II, any assistance on the answer is appreciated. CONTACT ME HERE NOW FOR HELP WITH YOUR FINANCE PROBLEM HERE IS MY EMAIL;devinortis@gmail.com I ACCEPT PAYMENTS VIA...

Hoyt, Inc. has estimated current year sales (in millions) for the next four quarters. Q1 $240Q2 $250 Q3 $205 Q4 $350 ? Sales for the 1st quarter next year are projected to be $230.? Accounts...

I have 4 questions I need help with in regards to finance. There are 4 tabs at the bottom of the excel file. Thanks a bunch! Problem 14-21 Yerba Industries is an all-equity firm whose stock has a...

A) 7.86% B) 9.43% C) 8.17% D) 4.67% E) 5.90% 133) What is the expected return on a portfolio that is equally weighted between Stocks M and N given the following information? State of Economy...

101 What is the net present value of the following cash flows if the relevant discount rate is 7 percent? A. $2,861.62 B. $2,311.92 C. $2,900.15 D. $3,248.87 E. $3,545.60 102. Whats NPV of the...

In a study undertaken by Catalyst, 43% of women senior executives agreed or strongly agreed that a lack of role models was a barrier to their career development. In addition, 46% agreed or strongly...

How many of the following accounts (line items) are found on the balance sheet? Accounts Payable Inventory Cash Paid for Merchandise Wages Payable Wages Expense Supplies Expense Deferred Revenue...

In the context of capital budgeting what does sensitivity analysis do

Not yet answered Points out of 2 Flag question In the context of management functions, which of the following is true of planning? Select one: a . It involves hiring and leading workers. b . It...

3.58 What is the conditional probability of regular, given high income? Table 3.10 Probabilities for Television Viewing and Income VIEWING FREQUENCY Regular Occasional Never Totals HIGH INCOME MIDDLE...

3.57 What is the conditional probability of low income, given occasional? Table 3.10 Probabilities for Television Viewing and Income VIEWING FREQUENCY Regular Occasional Never Totals HIGH INCOME...

3.56 What is the conditional probability of high income, given never? Table 3.10 Probabilities for Television Viewing and Income VIEWING FREQUENCY Regular Occasional Never Totals HIGH INCOME MIDDLE...