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General pharmacy's stock has a beta of 1.8 and an expected return of 14%, and sicoras corp.'s stock has a beta of 1.5 and an expected return of 16.2%. assuming capital-asset pricing model holds, calculate the return on the market portfolio.​ octonaut

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meerkat18
In order to calculate the return on market portfolio of the stock, you need to use this formula: Risk = risk free rate + beta of the stock (expected market return) Substituting the values to the formula:
General pharmacy – 25.20% (1.8 x 14%)
Sicoras Corp. – 24.30% (1.5 x 16.2%)

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