The Beta for an Asset Considered to Be Risk-Free

question 116

Multiple Choice

The beta for an asset considered to be risk-free

• A) can be any positive number.
• B) is negative.
• C) equals zero.
• D) equals 1.

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Definitions:

Substitution

The process of replacing one item with another due to changes in price, preference, or functionality.

Satisfaction

The feeling of pleasure or contentment that comes from fulfilling a desire, expectation, or need, or achieving a goal.

Marginal Rate

The rate at which one additional unit of something affects an outcome, often used in the context of taxes or production.

Substitution

The economic concept where consumers replace more expensive items with less costly alternatives, influencing demand and market dynamics.