Problem: Suppose you have invested $30,000 in the following four stocks:
Security Amount Invested Beta
Stock A $5,000 0.75
Stock B $10,000 1.1
Stock C $8,000 1.36
Stock D $7,000 1.88
The risk-free rate is 4 percent and the expected return on the market portfolio is 15 percent. Based on the capital-asset-pricing model, what is the expected return on the above portfolio?