Question: We have he following CAPM E(ri)=.06 +.08 beta ..... Question 12 q SE ai We have the following CAPM E(Ri)06+.08 Beta; a) If Stock X

We have he following CAPM E(ri)=.06 +.08 beta .....

Question 12 q SE ai We have the following CAPM E(Ri)06+.08 Beta; a) If Stock X has a beta of 2, what is the required rate of retur? asset, what is b) If we form a portfolio that is invested 40% in Stock X and 60% in the risk free asset, what is the expected rate of return on that portfolio? What is the beta of that portfolio? Stock Z has a beta of 1.5 Andan expected return of 15%. Is at a good buy? c) d)Construct a portfolio of Stock X and the risk free asset which has a beta of 1.5. e) What is the expected return for this purpose

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