Suppose Intel stock has a beta of 1.7, whereas Boeing stock has a beta of 0. If therisk-free interest rate is 5.9% and the expected return of the...
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Question

Suppose Intel stock has a beta of 1.7​, whereas Boeing stock has a beta of 0.91. If the​ risk-free interest

rate is 5.9% and the expected return of the market portfolio is 12.5%​, according to the​ CAPM,

a. What is the expected return of Intel​ stock?

b. What is the expected return of Boeing​ stock?

c. What is the beta of a portfolio that consists of 60% Intel stock and 40% Boeing​ stock?

d. What is the expected return of a portfolio that consists of 60% Intel stock and 40% Boeing​ stock?

Top Answer

a.) The expected return of Intelstock= 17.12% b.) The... View the full answer

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