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Suppose That Google Stock Has a Beta of 1

Question 10

Multiple Choice

Suppose that Google Stock has a beta of 1.06 and Boeing stock has a beta of 1.31.If the risk-free interest rate is 4% and the expected return from the market portfolio is 12%,then the expected return on a portfolio that consists of 30% Google stock and 70% Boeing stock is closest to:


A) 12.5%
B) 13.1%
C) 13.5%
D) 13.9%

Correct Answer:

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