Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

A stock has a beta of 1.20 and an expected return of 14 percent. A risk-free asset currently earns 3.0 percent.

a. What is the expected return on a portfolio that is equally invested in the two assets? (Round your answer to 2 decimal places. (e.g., 32.16))

Expected return %

b. If a portfolio of the two assets has a beta of 0.72, what are the portfolio weights? (Round your answer to 4 decimal places. (e.g., 32.1616))

Weight of stock
Risk-free weight

c. If a portfolio of the two assets has an expected return of 10 percent, what is its beta? (Do not round intermediate calculations and round your answer to 3 decimal places. (e.g., 32.161))

Beta

d. If a portfolio of the two assets has a beta of 2.40, what are the portfolio weights? (Negative amount should be indicated by a minus sign.)

Weight of stock
Risk-free weight

 

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M924771

Have any Question? 


Related Questions in Basic Finance

1 what is the yield to maturity for an 8 percent bond

1. What is the yield to maturity for an 8 percent bond, paying coupon semi-annually that has 15 years until maturity and sells for $975? 2. There are regulations that prohibit "insider trading," which is the use of nonpu ...

1 show that in the atsp formulation the connectivity

1. Show that, in the ATSP formulation, the connectivity constraints (6.61) and the subtour elimination constraints (6.62) are equivalent. 2. Show that the number of vertices of odd degree in a graph is even. 3. Let G = ( ...

If asset as beta is greater than asset bs beta does this

If asset A's beta is greater than asset B's beta, does this mean that asset A has more risk than asset B? Explain? What is the difference between the security market line and the capital market line? How should an invest ...

What is meant by break even drivers identify two important

What is meant by break even drivers? Identify two important drivers affecting the amount of revenues needed for ventures to break even Explain

1 define the followinga time value of moneyb present valuec

1. Define the following: a. Time value of money b. Present value c. Discounting 2. How is the price of a financial asset related to the payments to be received from owning it?

1 using the internet the library or another information

1. Using the Internet, the library, or another information source, print out three different articles that describe the same disaster event. Compare the three articles to determine which provides the most useful informat ...

1nbspcalculate the cost of new common equity financing of

1. Calculate the cost of new common equity financing of stock R using Gordon Model Round the answers to two decimal places in percentage form (Write the percentage sign in the "units" box) Last Year Dividend Growth Rate ...

A firm has previously issued fixed rate noncallable debt

A firm has previously issued fixed rate noncallable debt. Because interest rates are perceived to be temporarily high, the firm would like to have the flexibility of calling the debt later when rates are expected to fall ...

Suppose that you wish to buy stock and protect yourself

Suppose that you wish to buy stock and protect yourself against a downside movement in its price. You consider both a covered call and a protective put. What factors will affect your decision? You have inherited some sto ...

1 what three rules govern the construction of a grouped

1. What three rules govern the construction of a grouped frequency distribution? 2. What is the difference between a histogram and a bar graph? 3. Distinguish among the median, mode, and mean.

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen