problem: A stock has a beta of 0.8 & an expected return of 13%. A risk-free asset currently earns 4%.
[A] find out the expected return on a portfolio that is equally invested in the two assets?
[B] If a portfolio of the two assets has a beta of 0.6, find out the portfolio weights?
[C] If a portfolio of the two assets has an expected return of 11%, determine its beta?
[D] If a portfolio of the two assets has a beta of 1.60, determine the portfolio weights? How do you interpret the weights for the two assets in this case? describe your reasoning.