Problem: A stock has a beta of 1.20 and an expected return of 14 percent. A risk-free asset currently earns 3.0 percent.
Q1. What is the expected return on a portfolio that is equally invested in the two assets? (Round your answer to 2 decimal places.)
Q2. If a portfolio of the two assets has a beta of 0.72, what are the portfolio weights? (Round your answer to 4 decimal places.)
Q3. If a portfolio of the two assets has an expected return of 10 percent, what is its beta? (Do not round intermediate calculations and round your answer to 3 decimal places.)
Q4. If a portfolio of the two assets has a beta of 2.40, what are the portfolio weights? (Negative amount should be indicated by a minus sign.)