Cheyenne holds a $5,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock’s beta, is listed in the following table: Stock Investment Beta Standard Deviation...

Cheyenne holds a $5,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock’s beta, is listed in the following table:

Stock	Investment	Beta	Standard Deviation
Andalusian Limited (AL)	$1,750	0.90	15.00%
Tobotics Inc. (TI)	$1,000	1.70	11.50%
Water and Power Co. (WPC)	$750	1.15	18.00%
Makissi Corp. (MC)	$1,500	0.50	25.50%

Suppose all stocks in Cheyenne’s portfolio were equally weighted. Which of these stocks would contribute the least market risk to the portfolio?

Water and Power Co.

Makissi Corp.

Tobotics Inc.

Andalusian Limited

Suppose all stocks in the portfolio were equally weighted. Which of these stocks would have the least amount of stand-alone risk?

Andalusian Limited

Makissi Corp.

Tobotics Inc.

Water and Power Co.

If the risk-free rate is 7% and the market risk premium is 8.5%, what is Cheyenne’s portfolio’s beta and required return? Fill in the following table:

	Beta	Required Return
Cheyenne’s portfolio

Jun 04, 2022

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Cheyenne holds a $5,000 portfolio that consists of four stocks. Her investment in each stock, as well as each stock’s beta, is listed in the following table: Stock Investment Beta Standard Deviation...

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