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A stock has a beta of .92 and an expected return of 10.3 percent. A risk free asset currently earns 5 percent.

a. What is 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 .50, what are the portfolio weights?

c. If a portfolio of the two assets has an expected return of 9 percent, what is its beta?

d. a portfolio of the two assets has a beta of 1.84, what are the portfolio weights? How do you interpret the weights for the two assets in this case? describe.

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