What is the expected return of a portfolio with two stocks that has 450 shares of stock A, which has a price of $32.20 per share and an expected return of 10.36%, and $51,900.00 of stock B, which has a beta of 1.18? The market has an expected return of 14.70 %, the inflation rate is 1.60 %, and the risk-free rate is 2.10%. 15.53% (plus or minus 4 bps) 13.88% (plus or minus 4 bps) 17.46% (plus or minus 4 bps) 15.99% (plus or minus 4 bps) None of the above is within 4 bps of the correct answer
What is the expected return of a portfolio with two stocks that has 450 shares of stock A, which has a price of $32.20 per share and an expected return of 10.36%, and $51,900.00 of stock B, which has a beta of 1.18? The market has an expected return of 14.70 %, the inflation rate is 1.60 %, and the risk-free rate is 2.10%. 15.53% (plus or minus 4 bps) 13.88% (plus or minus 4 bps) 17.46% (plus or minus 4 bps) 15.99% (plus or minus 4 bps) None of the above is within 4 bps of the correct answer
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 12P
Question
![What is the expected return of a portfolio with two stocks that has 450 shares of stock A, which has a price of $32.20 per share and an expected return of
10.36%, and $51,900.00 of stock B, which has a beta of 1.18? The market has an expected return of 14.70 %, the inflation rate is 1.60 %, and the risk-free rate is
2.10%.
15.53% (plus or minus 4 bps)
13.88% (plus or minus 4 bps)
17.46% (plus or minus 4 bps)
15.99% (plus or minus 4 bps)
None of the above is within 4 bps of the correct answer](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F19d0c0ee-b2f7-4400-bddc-d84e0eebb818%2F017b3ad5-53ba-4e8d-a1b7-7820beb31f51%2Fhvz01ic_processed.jpeg&w=3840&q=75)
Transcribed Image Text:What is the expected return of a portfolio with two stocks that has 450 shares of stock A, which has a price of $32.20 per share and an expected return of
10.36%, and $51,900.00 of stock B, which has a beta of 1.18? The market has an expected return of 14.70 %, the inflation rate is 1.60 %, and the risk-free rate is
2.10%.
15.53% (plus or minus 4 bps)
13.88% (plus or minus 4 bps)
17.46% (plus or minus 4 bps)
15.99% (plus or minus 4 bps)
None of the above is within 4 bps of the correct answer
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