correctly priced, assuming that R; = 5% and Rm = 10%. A B Current price (P) $50 80 100 Next year price (P¡) $54 84 120 Dividend (D,) $2 4 5 Beta 0.8 1.2 3.0 If you were offered a 20-30-50 portfolio of the above securities as a package deal, will you take it? Why?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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4.
Use the information given below to determine if the following securities are
correctly priced, assuming that R = 5% and Rm = 10%.
A
В
Current price (Po)
$50
80
100
Next year price (P)
$54
84
120
Dividend (D,)
$2
4
5
Beta
0.8
1.2
3.0
If you were offered a 20-30-50 portfolio of the above securities as a package deal, will
you take it? Why?
Transcribed Image Text:4. Use the information given below to determine if the following securities are correctly priced, assuming that R = 5% and Rm = 10%. A В Current price (Po) $50 80 100 Next year price (P) $54 84 120 Dividend (D,) $2 4 5 Beta 0.8 1.2 3.0 If you were offered a 20-30-50 portfolio of the above securities as a package deal, will you take it? Why?
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