Mulherin's Stock Has a Beta of 1

question 22

Multiple Choice

Mulherin's stock has a beta of 1.23,its required return is 11.75%,and the risk-free rate is 2.30%.What is the required rate of return on the market? (Hint: First find the market risk premium. ) Do not round your intermediate calculations.

• A) 7.69%
• B) 8.19%
• C) 9.98%
• D) 12.38%
• E) 10.58%

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Definitions:

Amplifier

An electronic device that increases the power, voltage, or current of a signal.

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An involuntary, rhythmic muscle contraction leading to shaking movements in one or more parts of the body.

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A disorder affecting the nervous system, which includes the brain, spinal cord, and nerves.

Defibrillator

A defibrillator is a medical device used to deliver a dose of electric current (shock) to the heart in order to correct irregular heart rhythms and potentially prevent cardiac arrest.