Two risky portfolios exist for investing

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Different investor weights. Two risky portfolios exist for investing: one is a bond portfolio with a beta of 0.7 and an expected return of 7.2%, and the other is an equity portfolio with a beta of 1.1and an expected return of 16.9%. If these portfolios are the only two available assets for investing, what combination of these two assets will give the following investors their desired level of expected return? What is the beta of each investor's combined bond and equity portfolio?

a. Bart: desired expected return 16%

b. Lisa: desired expected return 14%

c. Maggie: desired expected return 12%

Reference no: EM132005687

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