Business Finance Homework Help

You have been managing a $5 million portfolio that has a beta of 1.70 and a required rate of return of 10%. The current risk-free rate is 4.25%. Assume that you receive another $500,000. If you invest the money in a stock with a beta of 1.90, what will be the required return on your $5.5 million portfolio? Round your answer to two decimal places.