Question
In: Finance
Suppose you are the money manager of a $200,000 investment fund. The fund consists of four...
Suppose you are the money manager of a $200,000 investment fund. The fund consists of four stocks with the following investments and betas:
|
Stock |
Investment |
Beta |
|
A |
$ 40,000 |
1.20 |
|
B |
$ 50,000 |
0.80 |
|
C |
$ 60,000 |
1.00 |
|
D |
$ 50,000 |
1.20 |
What is the portfolio’s beta?
Select one:
a. I do not have enough information
b. 1.00
c. 1.05
d. 1.04
Solutions
Expert Solution
Ans d. 1.04
| Stock | INVESTMENT (i) | Beta (ii) | Investment* Beta (i)* (ii) |
| A | 40,000 | 1.20 | 48,000.00 |
| B | 50,000 | 0.80 | 40,000.00 |
| C | 60,000 | 1.00 | 60,000.00 |
| D | 50,000 | 1.20 | 60,000.00 |
| Total | 2,00,000 | 2,08,000 | |
| AVERAGE BETA = | (INVESTMENT * BETA) / TOTAL INVESMENT | ||
| 208000 / 200000 | |||
| 1.04 |
jeff jeffy answered 2 years agoRelated Solutions
Suppose you are the money manager of a $4.57 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.57 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 240,000
1.50
B
400,000
(0.50)
C
980,000
1.25
D
2,950,000
0.75
If the market's required rate of return is 12% and the risk-free
rate is 4%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
Suppose you are the money manager of a $4.37 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.37 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 200,000
1.50
B
320,000
(0.50)
C
1,300,000
1.25
D
2,550,000
0.75
If the market's required rate of return is 10% and the risk-free
rate is 3%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
Suppose you are the money manager of a $4.22 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.22 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 260,000
1.50
B
300,000
(0.50
)
C
1,260,000
1.25
D
2,400,000
0.75
If the market's required rate of return is 8% and the risk-free
rate is 5%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
%
Suppose you are the money manager of a $4.86 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.86 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 480,000
1.50
B
800,000
(0.50
)
C
980,000
1.25
D
2,600,000
0.75
If the market's required rate of return is 13% and the risk-free
rate is 5%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
Suppose you are the money manager of a $4.37 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.37 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 460,000
1.50
B
680,000
(0.50)
C
1,380,000
1.25
D
1,850,000
0.75
If the market's required rate of return is 11% and the risk-free
rate is 6%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
Suppose you are the money manager of a $4.18 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.18 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 420,000
1.50
B
400,000
(0.50)
C
1,460,000
1.25
D
1,900,000
0.75
If the market's required rate of return is 9% and the risk-free
rate is 7%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
Suppose you are the money manager of a $4.66 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.66 million investment
fund. The fund consists of four stocks with the following
investments and betas: Stock Investment Beta A $ 240,000 1.50 B
520,000 (0.50) C 900,000 1.25 D 3,000,000 0.75 If the market's
required rate of return is 12% and the risk-free rate is 3%, what
is the fund's required rate of return? Do not round intermediate
calculations. Round your answer to two decimal places.
Suppose you are the money manager of a $4.38 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.38 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 440,000
1.50
B
400,000
(0.50
)
C
1,440,000
1.25
D
2,100,000
0.75
If the market's required rate of return is 12% and the risk-free
rate is 6%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
%
Suppose you are the money manager of a $4.62 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.62 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 360,000
1.50
B
600,000
(0.50
)
C
960,000
1.25
D
2,700,000
0.75
If the market's required rate of return is 10% and the risk-free
rate is 6%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
Suppose you are the money manager of a $4.48 million investment fund. The fund consists of...
Suppose you are the money manager of a $4.48 million investment
fund. The fund consists of four stocks with the following
investments and betas:
Stock
Investment
Beta
A
$ 340,000
1.50
B
800,000
(0.50
)
C
1,140,000
1.25
D
2,200,000
0.75
If the market's required rate of return is 11% and the risk-free
rate is 6%, what is the fund's required rate of return? Do not
round intermediate calculations. Round your answer to two decimal
places.
2. An individual has $20,000...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Why does a particular codon represent only one specific amino acid?
- Write a function template sort that takes two references to generic objects and switches them if...
- What 2 things happen to the melting point of a solid when an impurity is present?
- How Can Hominin Evolution be characterized as " mosaic evolution" Use examples of species from the...
- Absorption and Variable Costing Income Statements for Two Months and Analysis During the first month of...
- Mobile and wireless devices are being increasingly used in the Business Administration and Management Industry. write...
- What are the options that might be considered in relation to introducing flexible work practices? What...
ADVERTISEMENT