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Asset W has an expected return of 13.45 percent and a beta of 1.34. If the risk-

ID: 2745080 • Letter: A

Question

Asset W has an expected return of 13.45 percent and a beta of 1.34. If the risk-free rate is 4.59 percent, complete the following table for portfolios of Asset W and a risk-free asset. (Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations. Enter your portfolio expected return answers as a percentage and round to 2 decimal places (e.g., 32.16). Round your portfolio beta answers to 3 decimal places (e.g., 32.161).) Percentage of Portfolio Portfolio Portfolio in Asset W Expected Return Beta 0% % 25 % 50 % 75 % 100 % 125 % 150 %

Explanation / Answer

Answer:

Percentage of Portfolio Portfolio Portfolio in Asset W Expected return Beta 0% 4.59% 0.000 25% 6.81% 0.335 50% 9.02% 0.670 75% 11.24% 1.005 100% 13.45% 1.340 125% 15.67% 1.675 150% 17.88% 2.010
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