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Problem 12-15 Portfolio Risk and Return (LO2) Suppose that the S&P 500, with a beta...

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Problem 12-15 Portfolio Risk and Return (LO2) Suppose that the S&P 500, with a beta of 1.0, has an expected return of 12% and T-bills provide a risk-free return of 4%. a. What would be the expected return and beta of portfolios constructed from these two assets with weights in the S&P 500 of (i) O; (ii) .25; (iii) .50; (iv) .75; (v) 1.0? (Leave no cells blank - be certain to enter "O" wherever required. Do not round intermediate calculations. Round your answers to 2 decimal places.) Beta (i) 0 (ii) .25 (iii) .50 (iv) .75 (v) 1.0 Expected return % % % % % b. How does expected return vary with beta? (Do not round intermediate calculations.) The expected return (Click to select v by % for a one unit increase in beta

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