Suppose you are the money manager of a $4.94 million investment fund. The fund consists of four stocks with the following investments and betas: Stock Investment S 440,000 700,000 1,300,000 2,500,000 Beta 1.50 (0.50) 1.25 A D 0.75 If the market's required rate of return is 13% and the risk-free rate is 6%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal places. %
Suppose you are the money manager of a $4.94 million investment fund. The fund consists of four stocks with the following investments and betas: Stock Investment S 440,000 700,000 1,300,000 2,500,000 Beta 1.50 (0.50) 1.25 A D 0.75 If the market's required rate of return is 13% and the risk-free rate is 6%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal places. %
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter2: Risk And Return: Part I
Section: Chapter Questions
Problem 10P
Related questions
Question
![Finance
Suppose you are the money manager of a $4.94 million investment fund. The fund consists of four
stocks with the following investments and betas:
Stock Investment
A
В
Beta
1.50
S 440,000
700,000
1,300,000
2,500,000
(0.50)
1.25
0.75
If the market's required rate of return is 13% and the risk-free rate is 6%, what is the fund's required
rate of return? Do not round intermediate calculations. Round your answer to two decimal places.
%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F45876d27-81dd-4f53-8bf3-e338292196c1%2Fcac53809-2786-4153-b880-4c9c755a0978%2Fsj97gjn_processed.png&w=3840&q=75)
Transcribed Image Text:Finance
Suppose you are the money manager of a $4.94 million investment fund. The fund consists of four
stocks with the following investments and betas:
Stock Investment
A
В
Beta
1.50
S 440,000
700,000
1,300,000
2,500,000
(0.50)
1.25
0.75
If the market's required rate of return is 13% and the risk-free rate is 6%, what is the fund's required
rate of return? Do not round intermediate calculations. Round your answer to two decimal places.
%
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