Question

What is the beta of the following portfolio?   Stock Value Beta A $32,960 0.76 B $15,780...

What is the beta of the following portfolio?  

Stock Value Beta
A $32,960 0.76
B $15,780 1.31
C $8,645 1.49
D $19,920 0

Select one:

a. .60 to .80

b. More than .80

c. .40 to .60

d. Less than .20

e. .20 to .40

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Answer #1
Beta of the portfolio
Stock Investment Weight Beta Weight*beta
a b c=b/77305 d e=c*d
A $         32,960 0.43 0.76 0.32
B $         15,780 0.20 1.31 0.27
C $            8,645 0.11 1.49 0.17
D $         19,920 0.26 0 0.00
Total $         77,305 1.00 0.76

Correct Option=a. .60 to .80

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