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You Have a $1,000 Portfolio Which Is Invested in Stocks

Question 114

Multiple Choice

You have a $1,000 portfolio which is invested in stocks A and B plus a risk-free asset. $350 is invested in stock A. Stock A has a beta of 1.5 and stock B has a beta of .8. How much needs to be invested in stock B if you want a portfolio beta of .90?


A) $0
B) $351
C) $382
D) $469
E) $650

Correct Answer:

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