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Determining the percentage of the portfolio

A stock has a beta of 1.2 and an expected return of 17 percent. A risk-free asset currently earns 5.1 percent. The beta of a portfolio comprised of these two assets is 0.85. What percentage of the portfolio is invested in the stock?

a. 71%

b. 77%

c. 84%

d. 89%

e. 92%

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Finance Basics: Determining the percentage of the portfolio

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Determining the percentage of the portfolio

Reference No:- TGS0672978

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

Q : What is the average collection period for accounts

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Solution Preview :

Prepared by a verified Expert

Finance Basics: Determining the percentage of the portfolio

Reference No:- TGS0672978

Recent Questions Asked Finance Basics

Q : What is the average collection period for accounts

Q : Determining the value of one share

Q : What should be adjusted balance of allowance for doubtful

Q : What is return on invested capital

Q : Determining the percentage of the portfolio

Q : Computing the total dividend payment

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