Division only projects with same risk as market portfolio

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Reference no: EM131508779

Trotsky Adventures Inc. is financed entirely by equity and has three divisions, as follows:

• Division A is the mature products division, and has a beta of 0.8.

• Division B takes only projects with the same risk as the market portfolio.

• Division C is the research and development division, where the average beta of projects taken is 1.6.

Trotsky’s assets are divided in equal parts (both in terms of market value and book value) among the three divisions. What is Trotsky’s Beta?

Reference no: EM131508779

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