8-2 PORTFOLIO BETA An individual has $35,000 invested in a stock with a beta of 0 8 and another $40,000 invested in a stock with a beta of 1 4. If these are the only two investments in her portfolio, what is her portfolio’s beta?

The correct answer is 1.12.

Explanation:

According to the scenario, the given data are as follows:

First investment = $35,000

Beta for first investment = 0.8

Second investment = $40,000

Beta for second investment = 1.4

Total portfolio value = $35,000 + $40,000 = $75,000

So, we can calculate her portfolio’s beta by using following formula:

Portfolio beta = Average beta (first stock) + Average beta (second stock)

where, Average beta (first stock) = 0.8 × $35,000 ÷ $75,000

= 0.37

And Average beta (second stock) = 1.4 × $40,000 ÷ $75,000

= 0.75

So, by putting the value, we get

Portfolio beta = 0.37 + 0.75

= 1.12

Hence, The portfolio beta for two investments is 1.12.

hi : ) i found this so i hope this !

"we first find value of tax in dollars.

the difference between the two prices   is: 23. 54 - 22 = 1.54

therefore the sales tax in dollars is 1.54

the tax % will be   (amount of tax / original cost price ) × 100

(1.54 / 22) × 100  → (0.07) × 100 =   7

so the tax rate is 7%

we can double check the answer.

7 % of 22   → (7/100) × 22 → 0.07 × 22 = 1.54

22 + 1.54 = 23.54"