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You Have Just Purchased Some Shares in a Canadian Public

question 52

True/False

You have just purchased some shares in a Canadian public company.Your friends call you an "investee." You are surprised that they got it wrong: you are an investor.


Definitions:

Divisional Beta

A measurement of the risk associated with a particular division of a company, relative to the overall market.

Accounting Beta

A measure of the sensitivity of a company's operating income to changes in the economy or its sector, used for risk assessment in strategic planning.

Beta

The measure of market risk in portfolio theory. The degree to which a stock’s return moves with the market’s return.

Cost of Capital

The vital rate of earnings a company must generate from its investment plans to preserve its standing in the market and appeal for investments.

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