A Security Has an Expected Rate of Return of 0

question 20

Multiple Choice

A security has an expected rate of return of 0.15 and a beta of 1.25. The market expected rate of return is 0.10, and the risk-free rate is 0.04. The alpha of the stock is

• A) 1.7%.
• B) −1.7%.
• C) 8.3%.
• D) 3.5%.

---

Definitions:

Project Attributes

Features or qualities that define and differentiate projects, including scope, time, cost, quality, and risk.

Project Profiling

The process of analyzing a project's characteristics and requirements to determine the most suitable methodologies and tools for its successful completion.

Project Profiling

The process of analyzing the characteristics of a project to understand its scope, complexity, and potential risks.

Ecological Attributes

Characteristics or properties of an environment or ecosystem that determine its capacity to support life and maintain ecological processes.