Question
An investor has a portfolio of two securities, a stock with a beta of 1.24 and a risk-free asset. The stock has an expected return of 13.68% and the risk-free asset has an expected return of 2.80%. The portfolio beta is 0.65. What rate of return should the investor expect to earn on her portfolio?
 
Group of answer choices
8.50%
9.16%
9.33%
9.41%
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EBK CONTEMPORARY FINANCIAL MANAGEMENT
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ISBN: 9781337514835
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Publisher: CENGAGE LEARNING - CONSIGNMENT
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