Samantha is the money manager of a R4 000 000 investment fund. The fund consists of four shares with the following investments and betas Share. Investment Beta Class A share R400 000 1,50 Class B share R600 000 -0,50 Class C share R1 000 000 1,25 Class D share R2 000 000 0,75 If the market required rate of return is 14% and the risk-free rate is 6%, what is the fund’s required rate of return? 1. 11,90% 2. 12,10% 3. 13,30% 4. 14,67%

Samantha is the money manager of a R4 000 000 investment fund. The fund consists of four shares with the following investments and betas Share. Investment Beta Class A share R400 000 1,50 Class B share R600 000 -0,50 Class C share R1 000 000 1,25 Class D share R2 000 000 0,75 If the market required rate of return is 14% and the risk-free rate is 6%, what is the fund’s required rate of return? 1. 11,90% 2. 12,10% 3. 13,30% 4. 14,67%

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter2: Risk And Return: Part I

Section: Chapter Questions

Problem 10P

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