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Stock A's Stock Has a Beta of 1

question 26

Multiple Choice

Stock A's stock has a beta of 1.30, and its required return is 12.00%.Stock B's beta is 0.80.If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint: First find the market risk premium.)


Definitions:

Variation

The extent to which data points in a dataset differ from each other and from their average value.

Control Chart

A graphical tool used in process control to display how a process varies over time and to detect whether a process is statistically controlled.

Attributes Data

Qualitative data that is categorized based on attributes or characteristics, rather than numerical values.

Process Capability Analysis

A statistical technique used to determine if a manufacturing or business process is capable of meeting its design specifications and quality demands.

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