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What does the expected return of the new investment need

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Problem 1: You manage a $4 million portfolio that has a beta of 1.25 and an expected return of 11.7% per year. You intend to invest an additional $2 million in the portfolio so that the expected return increases to 12.5% per year. If the risk-free interest rate is 4.2% per year, what does the expected return of the new investment need to be?

Reference no: EM132693771

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