Summer 2 (June) 2018 Unless otherwise instructed, use two 12) decimal places for

Question

Summer 2 (June) 2018 Unless otherwise instructed, use two 12) decimal places for both percentages and dollar amounts. This is enforced. When entering units, use % for percentages, $ for dollar amounts, years for time and for times" Ibeta) Question 22 (4 points) You invest in common stocks and currently hold a well-diversifed portfolio with an expected return of 12.00 percent, a beta of 1.00, and a total value of $15000. You plan to add to the portfolio by buying 100 shares of AT&E; at $90.00 a share. AT&E; has an expected return of 20.00 percent with a beta of 0.50. After you purchase the new stock, the beta of the enlarged portfolio, will be: Your Answer Answer units Previous Page Next Page Page 22 of 25 Save All Responses Go to Submit Quiz 12

Explanation / Answer

Beta of enlarged portfolio is .8125 Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars No of shares Share price Market Price Weight Beta Weighted Beta Original Common Stock            15,000.00                  0.6250                      1.00                  0.6250 Additional common stock                  100.00                    90.00              9,000.00                  0.3750                      0.50                  0.1875            24,000.00                  1.0000                  0.8125

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.