In this video, we walk through a simple finance problem involving portfolio beta and the Capital Asset Pricing Model (CAPM). Sarah wants to invest in a portfolio with a beta of 0.528, and we explore how to divide her funds between a risk-free asset and the market portfolio to achieve that beta. We break down the formula for calculating portfolio beta and demonstrate how the weights of the two assets—risk-free rate (rf) and market portfolio—can be determined. By simplifying the process, we show how to solve for the required allocation, making it easy for finance students to approach similar problems on exams.