Katherine is risk averse what is the highest return she can


Beta coefficients and the capital asset pricing model Katherine Wilson is wondering how much risk she must undertake to generate an acceptable return on her portfolio. The risk-free return currently is 5%. The return on the overall stock market is 16%. Use the CAPM to calculate how high the beta coefficient of Katherine's portfolio would have to be to achieve each of the following expected portfolio returns.

a. 10%

b. 15%

c. 18%

d. 20%

e. Katherine is risk averse. What is the highest return she can expect if she is unwilling to take more than an average risk?

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Finance Basics: Katherine is risk averse what is the highest return she can
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