The Risk-Free Rate Is 4

question 58

Multiple Choice

The risk-free rate is 4.0% and the expected return on the market is 8%. Stock A has a beta of 1.35. For a given year, Stock A returned 12.0% while the market returned 8.80%. The systematic portion of Stock A's unexpected return was ________% and the unsystematic portion was ________%.

• A).80; 1.30
• B).90; 1.40
• C)1.08; 1.52
• D)1.40; .90
• E)4.62; 1.41

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Definitions:

Managing Strategies

Approaches or methods employed in handling, directing, or controlling tasks or situations effectively.

Unplanned Terminations

The unexpected end of a service or professional relationship, often due to unforeseen circumstances, without achieving the anticipated outcomes.

Command Button

A user interface element that triggers a pre-defined action or event when clicked by the user, typically found in software applications.

Check Box

A form control element that allows users to make binary choices, typically represented as a square box that can be marked with a check symbol.