A Stock Has an Expected Return of 13

question 63

Multiple Choice

A stock has an expected return of 13.24 percent, the risk-free rate is 4.4 percent, and the market risk premium is 8.98 percent. What is the stock's beta?

• A) 1.03
• B) .98
• C) 1.09
• D) 1.11
• E) 1.06

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Definitions:

Informational Social Influence

The process of changing one's behavior or beliefs in order to align with perceived group norms, based on the desire for accuracy rather than conformity.

Normative Social Influence

The effect of people around us compelling us to adapt so as to be favored and included by them.

Deindividuation

A psychological state characterized by reduced self-awareness and decreased personal accountability, often occurring within groups.

Social Facilitation

The tendency for people to perform differently when in the presence of others than when alone, typically showing improvement in performance on simple tasks.