Multiple Choice
Risk Premiums You own $5,000 of Software Corp's stock that has a beta of 3.75. You also own $10,000 of Home Improvement Corp (beta = 1.5) and $15,000 of Publishing Corp (beta = 0.35) . Assume that the market return will be 13 percent and the risk-free rate is 4.5 percent. What is the risk premium of the portfolio?
A) 11.05%
B) 16.50%
C) 17.00%
D) 24.70%
Correct Answer:
Verified
Correct Answer:
Verified
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