If Geek Computer Has a Beta of 1

question 52

Multiple Choice

If Geek Computer has a beta of 1.1,the return from Treasury bills is 3% and the return from the market portfolio is 20%,what is the required return from Geek stock?

• A) 20.0%
• B) 22.8%
• C) 15.7%
• D) 18.7%
• E) 21.7%

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Definitions:

Superposition Theorem

The current in any branch of a circuit supplied by a multipower source can be determined by finding the current produced in a particular branch by each of the individual power sources acting alone.

Kirchhoff's Current Law

Kirchhoff's Current Law states that the total current entering a junction or node in an electrical circuit is equal to the total current leaving that junction, preserving the principle of charge conservation.

Algebraic Sum

The result of adding or subtracting a sequence of numbers or algebraic expressions according to mathematical rules.

Kirchhoff's Voltage Law

A principle in electrical engineering that states that the sum of the electrical voltage differences around any closed network is zero.