A portfolio consists of two assets, Stock A and the risk -free asset (T-bills). Stock A has a beta o


A portfolio consists of two proceeds, Hoard A and the occasion -free asset (T-bills). Hoard A has a beta of 1.2 and an expected return of 14%. The occasion-free asset currently earns 4%. If the portfolio of the two proceeds has a beta of 0.8, what are the weightings of the two proceeds in the portfolio?

a. Risk-free asset = 33%, hoard A = 67%

b. Risk-free asset = 50%, hoard A = 50%

c. Risk-free asset = 67%, hoard A = 33%

d. Risk-free asset = 3%, hoard A = 97%

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