Given Are the Following Two Stocks a and B

question 65

Multiple Choice

Given are the following two stocks A and B: If the expected market rate of return is 0.09, and the risk-free rate is 0.05, which security would be considered the better buy, and why?

• A)A because it offers an expected excess return of 1.2%.
• B)B because it offers an expected excess return of 1.8%.
• C)A because it offers an expected excess return of 2.2%.
• D)B because it offers an expected return of 14%.

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Definitions:

Presidential Nominee

The candidate chosen by a political party to compete for the presidency in a national election.

Caucus Method

A method of selecting political candidates or making policy decisions, usually within a political party or a legislative body, involving meetings of supporters or representatives.

Delegate Selection

The process by which political parties choose representatives (delegates) to attend their national conventions, typically through primaries or caucuses.

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A gathering or assembly at the state level, often for political, social, or educational purposes, which can involve decision-making or election processes.