The beta of stock A is 1.5 and the beta of the overall market is 1.0. A portfolio is invested 60% in stock A and 40% in the market. The risk-free return and market return are 6% and 17%, respectively.
What is the fair (required) return on the portfolio according to CAPM?
1.20.3%
2. 15.71%
3.15.71%
4. 25.71%
+5
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Home » Business » The beta of stock A is 1.5 and the beta of the overall market is 1.0. A portfolio is invested 60% in stock A and 40% in the market. The risk-free return and market return are 6% and 17%, respectively.