Ritter Company's Stock Has a Beta of 1

question 107

Multiple Choice

Ritter Company's stock has a beta of 1.40,the risk-free rate is 4.25%,and the market risk premium is 5.50%.What is Ritter's required rate of return?

• A)11.36%
• B)11.65%
• C)11.95%
• D)12.25%

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Definitions:

Income

The money received, especially on a regular basis, for work, through investments, or other sources.

Ipads

A line of tablet computers designed, developed, and marketed by Apple Inc., known for their touch screen interface and wide range of applications.

Quantity Demanded

The specific amount of a product consumers desire to buy at a particular price point, illustrating the relationship between price and demand.

Law of Supply

An economic principle stating that as the price of a good increases, suppliers will produce more of it, and as the price decreases, they will produce less.