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Beta of Portfolio; Portfolio Weights

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1. A Sports sales company, the Eisenhower Corporation in 1956, invested in the stock market the following:

______________________________Portfolio Betas__________________
Security $ Invested Expected Return Beta
Kindred Healthcare: $1,000 8% .80
Ford: 2,000 12 .95
GMC: 3,000 15 1.10
Comerica: 4,000 18 1.40
a. What is the Beta of this portfolio?
b. Does this portfolio have more or less systematic risk than an average asset?
(Hint: Determine the portfolio weights.)

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Solution Summary

The solution calculates the Beta for the portfolio in an Excel spreadsheet.

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______________________________Portfolio Betas__________________

Security $ Invested Expected ...

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