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QUESTION
You would like to create a portfolio that is equally invested in a risk-free asset and two stocks. The one stock has a beta of .
You would like to create a portfolio that is equally invested in a risk-free asset and two stocks. The one stock has a beta of .80. What does the beta of the second stock have to be if you want the portfolio risk to equal that of the overall market?
Select one:
a. 1.4b. 1.6c. 1.8d. 2.0e. 2.2