You Hold a Portfolio Consisting of a $5,000 Investment in Each

Multiple Choice

You hold a portfolio consisting of a $5,000 investment in each of 20 different stocks.The portfolio beta is equal to 1.12.You have decided to sell a coal mining stock (b = 1.00) at $5,000 net and use the proceeds to buy a like amount of a mineral rights company stock (b = 2.00) .What is the new beta of the portfolio?

A) 1.1139
B) 1.1700
C) 1.2311
D) 1.2927
E) 1.3573