Suppose News Corporation shares have a beta of 1.55?, whereas CBA shares have a beta of...

60.1K

Verified Solution

Question

Finance

Suppose News Corporation shares have a beta of 1.55?, whereasCBA shares have a beta of 0.85. If the? risk-free interest rate is4.8 % and the expected return of the market portfolio is 13.2 %?,according to the? CAPM, a. what is the expected return of NewsCorp? shares? b. what is the expected return of CBA? shares? c.what is the beta of a portfolio that consists of 65 % News Corpshares and 35 % CBA? shares? d. what is the expected return of aportfolio that consists of 65 % News Corp shares and 35 % CBA?shares?

a. What is the expected return of News Corp? shares? News?Corp's expected return is nothing?%. ?(Round to one decimal?place.) b. What is the expected return of CBA? shares? ?CBA'sexpected return is nothing?%. ?(Round to one decimal? place.) c.What is the beta of a portfolio that consists of 65 % News Corpshares and 35 % CBA? shares? The portfolio beta is nothing. ?(Roundto two decimal? places.) d. What is the expected return of aportfolio that consists of 65 % News Corp shares and 35 % CBA?shares? The expected return of the portfolio is nothing?%. ?(Roundto one decimal? place.)

Answer & Explanation Solved by verified expert
4.1 Ratings (466 Votes)
a risk free interest rate 48 Beta of News Corporation 155 Expected return on market portfolio 132 Market risk premium Expected return on market portfolio risk free interest rate 132 48 84 According to CAPM Expected return of New Corporation    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Transcribed Image Text

Suppose News Corporation shares have a beta of 1.55?, whereasCBA shares have a beta of 0.85. If the? risk-free interest rate is4.8 % and the expected return of the market portfolio is 13.2 %?,according to the? CAPM, a. what is the expected return of NewsCorp? shares? b. what is the expected return of CBA? shares? c.what is the beta of a portfolio that consists of 65 % News Corpshares and 35 % CBA? shares? d. what is the expected return of aportfolio that consists of 65 % News Corp shares and 35 % CBA?shares?a. What is the expected return of News Corp? shares? News?Corp's expected return is nothing?%. ?(Round to one decimal?place.) b. What is the expected return of CBA? shares? ?CBA'sexpected return is nothing?%. ?(Round to one decimal? place.) c.What is the beta of a portfolio that consists of 65 % News Corpshares and 35 % CBA? shares? The portfolio beta is nothing. ?(Roundto two decimal? places.) d. What is the expected return of aportfolio that consists of 65 % News Corp shares and 35 % CBA?shares? The expected return of the portfolio is nothing?%. ?(Roundto one decimal? place.)

Other questions asked by students