Question: You try to create a portfolio that generates an expected return of 13.5% and a beta of 1.1 by investing in two stocks (PMT and

You try to create a portfolio that generates an expected return of 13.5% and a beta of 1.1 by investing in two stocks (PMT and QQQ) and a risk-free asset with a rate of 4%. PMT's beta is 1.3, and its expected return is 16%. QQQ's beta is 0.9, and its expected return is 10.0%. What is the weight on PMT in your portfolio?

A. 35.00%

B. 65.00%

C. 51.71%

D. 48.29%

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