The Equilibrium Expected Return on an Asset Is 14%,the Risk-Free

question 48

Multiple Choice

The equilibrium expected return on an asset is 14%,the risk-free rate is 4% and the return on the market portfolio is 12%.What is the beta of the asset?

• A) 1.10
• B) 1.15
• C) 1.20
• D) 1.25
• E) 1.30

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Definitions:

Segregation Of Duties

A fundamental control principle that ensures critical tasks are divided among different individuals to prevent fraud and errors.

Physical Controls

Security measures implemented to safeguard tangible assets, such as locks, surveillance cameras, and secure storage facilities.

Documentation Procedures

The processes used for documenting a company's financial transactions, activities, and controls to ensure accuracy and reliability of financial records.

Documentation Procedures

The systematic process of organizing, managing, and maintaining records and documents for business operations.