Let investment in B be $x. Given that investment in A=$8000.
So, investment in risk free asset=$(16000-8000-x)=$(8000-x)
Beta of A=1.82, beta of B=0.61 and obviously risk free asset has no beta.
Required portfolio beta=1.1.
Thus,
Thus required investment in stock B=$4983.60.
So, total investment needed for require portfolio beta=$(8000+4983.60)=$12983.60
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