Solution-What will the portfolio new beta be

What will the portfolio new beta be

Reference no: EM131129823

You hold a diversified $100,000 portfolio consisting of 20 stocks with $5,000 invested in each. The portfolio's beta is 1.12. You plan to sell a stock with b = 0.90 and use the proceeds to buy a new stock with b = 1.80. What will the portfolio's new beta be?

a. 1.286

b. 1.255

c. 1.224

d. 1.194

e. 1.165

Reference no: EM131129823

Questions Cloud

Calculate earnings after taxes for each of your alternatives : Collins Systems, Inc., is trying to develop an asset-financing plan. The firm has $300,000 in temporary current assets and $200,000 in permanent current assets. Collins also has $400,000 in fixed assets. Assume a tax rate of 40 percent. Given the Col..

What was the company inventory turnover for the most recent : Using figures from the income statement and balance sheet, answer the following questions: a. What was the company’s inventory turnover for the most recent year reported? b. Using your answer from part a, what was the average number of days that merc..

What is the amount of consolidated net income : On the consolidated financial statements, what amount should have been shown for Equity in Subsidiary Earnings? On the consolidated financial statements, what amount should have been shown for consolidated dividends? What is the amount of consolidate..

How much are current assets what is the company quick ratio : A firm’s balance sheet contains $320 of cash, $2,000 of fixed assets, $1,380 of accounts receivable, $780 of accounts payable, $500 of inventory, and $1,000 on a revolving line of credit. Assuming that list contains all of the company’s assets and li..

What will the portfolio new beta be : You hold a diversified $100,000 portfolio consisting of 20 stocks with $5,000 invested in each. The portfolio's beta is 1.12. You plan to sell a stock with b = 0.90 and use the proceeds to buy a new stock with b = 1.80. What will the portfolio's new ..

How much would the reduction in assets improve the roe : Sales, costs, and net income would not be affected, and the firm would maintain the same debt ratio (but with less total debt). By how much would the reduction in assets improve the ROE?

How much would the cost reduction improve the roe : Last year Ann Arbor Corp had $160,000 of assets, $305,000 of sales, $20,000 of net income, and a debt-to-total-assets ratio of 37.5%. The new CFO believes a new computer program will enable it to reduce costs and thus raise net income to $33,000. Ass..

Complete the income statement and balance sheet for whittake : Complete the income statement and balance sheet for Whittaker, Inc. Show how each amount was determined. After completing part a, use your answers to recompute each of the financial ratios provided as additional information.

Prepare the journal entries to record the mortgage loan : Leoni Co. receives $240,000 when it issues a $240,000, 10%, mortgage note payable to finance the construction of a building at December 31, 2010.

User Account

All Pages

What will the portfolio new beta be

Reference no: EM131129823

Reference no: EM131129823

Questions Cloud

Reviews

Write a Review

Finance Basics Questions & Answers

Describe and discuss the saving-investment cycle

What is the after-tax salvage value

What is the primary thing that distinguishes an operating

Firm resources limit its search for opportunities

What is wacc old- wacc new

Revealed in half concealing

Describe the life cycle approach for teaching entrepreneure

What is the expected return on equity under each current

Was it ethical to initially start the company showing

The sources of the funds invested

What is the value of ending inventory

Part of clinical data integration

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT