Response to the following problem:
Jay is reviewing his portfolio of investments, which include certain shares and bonds. He has a large amount tied up in Treasury notes paying 3%. He is considering moving some of his funds from the T-notes into shares. The share has a beta of 1.25. If Bob expects a return of 14% from the share (a little better than the current market return of 13%), should he buy the share or leave his funds in the T-note?