Homework Clinic
Social Science Clinic => Business => Finance => Topic started by: ericka1 on Jul 11, 2018
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You hold a portfolio made up of the following stocks:
Investment Value Beta
Stock L 8,000 2.0
Stock M 18,000 1.5
Stock N 14,000 .4
If the market's expected return is 14, and the risk-free rate of return is 5, what is the expected
return of the portfolio?
A) 17.010 B) 16.700 C) 14.698 D) 15.935
Question 2
Consider the following assets: I. Treasury Strips, II. Coupon Treasury bonds, III. growth stocks, and IV. medium quality corporate bonds.
A cautious investor with high-priority future goals, but who does not need current income, would prefer
A)
I.
B)
II.
C)
III.
D)
IV.
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Answer to Question 1
D
Answer to Question 2
A