A stock has a beta of 7 and an expected return of 17


A stock has a beta of .7 and an expected return of 17 percent. A risk-free asset currently earns 4.8 percent.

a. What is the expected return on a portfolio that is equally invested in the two assets? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) Expected return %

b. If a portfolio of the two assets has a beta of .50, what are the portfolio weights? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) Portfolio Weight xS % xrf %

c. If a portfolio of the two assets has an expected return of 10.00 percent, what is its beta? (Do not round intermediate calculations. Round your answer to 4 decimal places.) Beta

d. If a portfolio of the two assets has a beta of 1.27, what are the portfolio weights? (Negative values should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) Portfolio Weight xS % xrf %

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Financial Management: A stock has a beta of 7 and an expected return of 17
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