Your portfolio consists of $100,000 invested in a stock that has a beta of 0.8, $150,000 invested in a stock with has a beta of 1.2, and $50,000 invested in a stock that has a beta of 1.8. The risk-free rate is 7%. Last year this portfolio had a required rate of return of 13%. This year nothing has changed except for the fact that the market risk premium has increased by two percentage points. What is the portfolio’s current required rate of return?

Answer rating: 100% (QA)

Risk free rate 7 Required rate of return 13 Market risk pre... View the full answer