Elinor has $139,000 invested in a stock that has a beta of 1 and $321,000 invested in a stock with a beta of 0.8.
a. If these are the only two investments in her portfolio, what is her portfolio's beta? Round your answer to two decimal places.
b. Use the capital asset pricing model to find the expected return on Elinor's portfolio if the return on the market is 13 percent and the risk-free rate of return is 3.5 percent.