A Security Has an Expected Rate of Return of 0

question 14

Multiple Choice

A security has an expected rate of return of 0.12 and a beta of 1.1. The market expected rate of return is 0.09, and the risk-free rate is 0.04. The alpha of the stock is

• A) 9.7%.
• B) 7.7%.
• C) 5.3%.
• D) 2.5%.

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Definitions:

Virtual Teams

Groups of individuals who work together from different geographic locations, connected by technology such as email, video conferencing, and collaboration platforms.

Frequent Communication

Regular and consistent exchange of information between individuals or groups, which is essential for ensuring transparency, understanding, and collaboration.

Virtual Team

A group of individuals who work together from different geographical locations, often using digital communication technology to collaborate on projects or tasks.

External Visibility

The extent to which an organization or individual is seen or recognized outside its immediate context or environment.