Asset A, Which Has an Expected Return of 12% and a Beta

question 191

Multiple Choice

Asset A, which has an expected return of 12% and a beta of 0.8, plots on the security market line. Which of the following is false about Asset B, another risky asset with a beta of 1.4?

• A) If the market is in equilibrium, Asset B also plots on the SML.
• B) If Asset B plots on the SML, then Asset B and Asset A have the same reward to risk ratio.
• C) Asset B has more systematic risk than both Asset A and the market portfolio.
• D) If Asset B plots on the SML with an expected return = 18%, then the risk-free rate must be 4%.
• E) If Asset B plots on the SML with an expected return = 18%, the expected return on the market must be 15%.

Comprehend the effects and applications of punishment, and differentiate it from negative reinforcement.

Identify and explain the partial reinforcement effect and its implications for behavior maintenance.

Understand the role of immediacy, magnitude, and quality of reinforcement in operant conditioning.

Recognize the concepts of avoidance, escape, and learned helplessness within the context of operant conditioning.

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Definitions:

Test Scores

Test scores are the quantitative results obtained from educational assessments or standardized tests, indicating a participant's performance.

Stratified Random Sampling

A method of sampling that involves dividing a population into smaller groups known as strata based on shared characteristics and then randomly sampling from these strata.

Strata

Layers or levels within a larger population that are distinguished by one or more characteristics, used in stratified sampling to improve the accuracy of the sample by ensuring it reflects the population's composition.

Subpopulations

Distinct groups within a larger population, distinguished by specific characteristics such as geography, interests, behaviour, or demographic traits.