If the markets required rate of return is 11 and the


Suppose you are the money manager of a $4.08 million investment fund. The fund consists of 4 stocks with the following investments and betas:

STOCK INVESTMENT BETA

a $480,000 1.50
b 480,000 - 0.50
c 1,220,000 1.25
d 1,900,000 0.75

If the market's required rate of return is 11% and the risk-free rate is 5%, what is the fund's required rate of return?

 

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Finance Basics: If the markets required rate of return is 11 and the
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