You hold the positions in the table below Assumed Advanced Micro Devices S 15.00

Question

You hold the positions in the table below Assumed Advanced Micro Devices S 15.00 00 216.00 20.00 22.00 Shares 311 98 Assumed Beta 4.21 1.48 0.95 0.76 FedEx Corp Microsoft Sara Lee Corp 120 246 What is the beta of your portfolio? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Portfolio beta 1.70 If you expect the market to earn 17 60 percent and the risk-free rate is 560 percent, what is the required return of the portfolio? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Required return Hints References eBook& Resources Hnt.a

Explanation / Answer

Portfolio Beta

=(15*311)/(15*311+216*98+20*120+22*246)*4.21+(216*98)/(15*311+216*98+20*120+22*246)*1.48+(20*120)/(15*311+216*98+20*120+22*246)*0.95+(22*246)/(15*311+216*98+20*120+22*246)*0.76

=1.70

Required return=5.60%+1.70*(17.60%-5.60%)=26.00%

the above is answer..

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