Gven the following information about stock ap0 6275betaa , Ask an Expert

Finance

Given the following information about Stock A:

P0 = $62.75

βA = 1.3

D1 = $2.20 paid at end of year KM = 11% annual

Rf = 5% annual

a. Estimate the price of stock A at the end of the year

b. Suppose that Stock a is combined with two other stocks as follows:

Stock

A B C

Proportion Beta

0.25 1.3 0.40 0.9 0.35 1.1

What is the beta of the portfolio of three stocks?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92093265

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