A stock has a beta of 114 an expected return of 1338


A stock has a beta of 1.14, an expected return of 13.38 percent, and lies on the security market line. A risk-free asset is yielding 2.84 percent. Ferghus wants to create a $15,000 portfolio that is comprised of these two securities and that will have a portfolio beta of 0.79. What is the expected return (in percents) on this portfolio?

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Financial Management: A stock has a beta of 114 an expected return of 1338
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