Suppose That the Simmons Corporation's Common Stock Has a Beta

question 34

Multiple Choice

Suppose that the Simmons Corporation's common stock has a beta of 1.6. If the risk-free rate is 5% and the market risk premium is 4%, the expected return for Simmons' common is:

• A) 4.0%.
• B) 5.0%.
• C) 5.6%.
• D) 10.6%.
• E) 11.4%.

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Definitions:

Restrictive

Limiting or controlling access, movement, or growth, often through rules, conditions, or physical barriers.

Nonrestrictive

Describes an element in a sentence, usually a clause or phrase, that provides additional information without limiting or defining the element it modifies.

Restrictive Clause

A part of a sentence that serves to limit or specify the meaning of the noun it modifies and is essential to the sentence's meaning.

Nonrestrictive Clause

A clause that provides additional information about a noun without limiting or defining it, often set off by commas.