Business, 28.11.2019 07:31 logan541972
Stock x has a beta of 0.7 and stock y has a beta of 1.3. the standard deviation of each stock's returns is 20%. the stocks' returns are independent of each other, i. e., the correlation coefficient, r, between them is zero. portfolio p consists of 50% x and 50% y. given this information, which of the following statements is correct a. portfolio p has a standard deviation of 20%.
b. the required return on portfolio p is equal to the market risk premium (rm ? rrf).
c. portfolio p has a beta of 0.7.
d. portfolio p has a beta of 1.0 and a required return that is equal to the riskless rate, rrf.
e. portfolio p has the same required return as the market (rm).
Answers: 3
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Stock x has a beta of 0.7 and stock y has a beta of 1.3. the standard deviation of each stock's retu...
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