Question

You want to create a portfolio equally as risky as the market, and you have $1,100,000 to invest. Consider the following information:

   

Asset	Investment	Beta
Stock A	$165,000	0.70
Stock B	$275,000	1.20
Stock C		1.55
Risk-free asset

   

Required:

(a)	What is the investment in Stock C? (Do not round your intermediate calculations.)
	A) $401,145 B) $405,368 C) $422,258 D) $268,876 E) $439,148

  

(b)	What is the investment in risk-free asset? (Do not round your intermediate calculations.)
	A) $391,124 B) $228,232 C) $247,252 D) $225,855 E) $237,742

Answer 1