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yosie yosie
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8 months ago
The risk-free rate is 7% and the market risk premium is 8%. Your $1 million portfolio consists of $600,000 invested in a stock that has a beta of 1.5 and $400,000 invested in a stock that has a beta of 0.9. Which of the following statements is correct?


▸

If the stock market is efficient, your portfolio’s expected return should equal the expected return on the market, which is 15%.



▸

The required return on the market is 12%.



▸

The portfolio’s required return is greater than 15%.



▸

If the risk-free rate remains unchanged but the market risk premium increases by 3%, your portfolio’s required return will increase by less than 3%.

Textbook 
Financial Management: Theory and Practice

Financial Management: Theory and Practice


Edition: 4th
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twogat123twogat123
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8 months ago
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yosie Author
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8 months ago
Good timing, thanks!
lubennick
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Yesterday
Helped a lot
Harvinder
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2 hours ago
This site is awesome
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