What Return Would You Expect If the Risk- Free Rate

question 21

Multiple Choice

What return would you expect if the risk- free rate of return was 5 per cent, the beta risk is 1.5, and the historical risk premium has been 6 per cent? (Base you calculation on the capital asset pricing model.)

• A) 14%
• B) 13.5%
• C) 11%
• D) 16.5%

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Definitions:

Machinery Operation

The process or action of working with mechanical devices to perform a specific task or function.

Psychologist

A professional trained in the science of behavior and mental processes, often providing services in therapy, research, or education.

Heredity

The passing of traits from parents to their offspring through genes.

Environment

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