Answered: Given the attached information:…

Given the attached information: Estimate the betas for Blandy and Gourmange companies? If you have a portfolio of 25% Blandy and 75% Gourmange, what is the beta for your portfolio?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

100%

Given the attached information:

Estimate the betas for Blandy and Gourmange companies?

If you have a portfolio of 25% Blandy and 75% Gourmange, what is the beta for your portfolio?

Year
1
2
3
4
5
6
7
8
9
10
Market
30%
7%
18%
-22%
-14%
10%
26%
-10%
-3%
38%
Blandy
26%
15%
-14%
-15%
2%
-18%
42%
30%
-32%
28%
Gourmange
47%
-54%
15%
7%
-28%
40%
17%
-23%
-4%
75%

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