Determine the Risk Free Rate If a Company's Rate of Return

question 92

Multiple Choice

Determine the risk free rate if a company's rate of return is 9%, its Beta is 1.8 and the expected return on the stock market is 10%.

• A)11.25%
• B)12.25%
• C)13.25%
• D)14.25%

---

Definitions:

Self-serving Bias

The common tendency to attribute positive events to one's own character but attribute negative events to external factors.

Psychology Exam

A test or assessment designed to measure knowledge, skills, or abilities in the field of psychology.

Intelligent

Refers to the ability to learn, understand, and make judgments or have opinions that are based on reason.

Cognitive Dissonance

An individual’s psychological discomfort (dissonance) caused by two inconsistent thoughts.