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Risk Premiums You Own $14,000 of Diner's Corp

Question 5

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Risk Premiums You own $14,000 of Diner's Corp.stock that has a beta of 2.1.You also own $14,000 of Comm Corp.(beta = 1.3) and $12,000 of Airlines Corp.(beta = 0.6) .Assume that the market return will be 15 percent and the risk-free rate is 6.5 percent.What is the total risk premium of the portfolio?


A) 11.645 percent
B) 20.55 percent
C) 23.905 percent
D) 38.00 percent

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