The quoted rate of a short-term government security is 2%. A premium of 3% is added to the risk-free rate to reflect the average market return. What is the required rate of return of the portfolio?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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The quoted rate of a short-term government security is 2%. A premium of 3% is added to the risk-free rate to reflect the average market return. What is the required rate of return of the portfolio?

National Co. has a collection of publicly traded shares below:
Stock
Invested Amount
Beta
АВС
1,400,000
1.8
CDE
1,200,000
2.2
EFG
600,000
1.4
HIJ
800,000
0.6
Transcribed Image Text:National Co. has a collection of publicly traded shares below: Stock Invested Amount Beta АВС 1,400,000 1.8 CDE 1,200,000 2.2 EFG 600,000 1.4 HIJ 800,000 0.6
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