Assume That the Risk-Free Rate Is 5

question 63

Multiple Choice

Assume that the risk-free rate is 5%.Which of the following statements is CORRECT?

• A) If a stock has a negative beta,its required return under the CAPM would be less than 5%.
• B) If a stock's beta doubled,its required return under the CAPM would also double.
• C) If a stock's beta doubled,its required return under the CAPM would more than double.
• D) If a stock's beta were 1.0,its required return under the CAPM would be 5%.
• E) If a stock's beta were less than 1.0,its required return under the CAPM would be less than 5%.

---

Definitions:

Freshwater Fish

Fish species that spend most or all of their lives in freshwater environments like rivers and lakes, as opposed to saltwater habitats.

Marine Fish

Fish species that live in oceanic environments as opposed to freshwater habitats, often adapting to saltwater conditions.

Solutes

Substances dissolved in a solvent to form a solution, often referring to solids dissolved in liquids.

Nutritional Value

Nutritional value refers to the content of essential nutrients in food, such as vitamins, minerals, and proteins, important for supporting life and health.