he following data is given with respect to three stocks and a market index M:...

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Finance

he following data is given with respect to three stocks and a market index M: (1.25 pct)

Stock

Expected return

Beta

A

10.5%

1.2

B

13%

0.98

C

15.7%

1.37

M

14.2%

1

  1. Write the estimated equation of the market model for a portfolio composed of these stocks in proportions of 30% A, 45% B and 25% C.

Pf:

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