Weight of each=(1/3)
Portfolio beta=Respective beta*Respective weight
=(1/3*0.6)+(1/3*1.35)+(1/3*1.4)=1.11667
Expected return=risk free rate+beta*(market rate-risk free rate)
=5+1.11667*(13.5-5)
=14.49%(Approx)
Suppose the risk-free rate is 5.00% and the market portfolio has an expected return of 13.50%....
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