Zilo Stock Has an Average Return Minus the Average Risk-Free

question 44

Multiple Choice

Zilo stock has an average return minus the average risk-free rate of 5 percent, a beta of 1, and a standard deviation of returns of 20 percent. The Sharpe index of Zilo stock is

• A)0.05.
• B)0.35.
• C)0.25.
• D)0.45.
• E)None of these are correct.

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Definitions:

Temperature Extremes

Conditions involving very high or very low temperatures that can cause stress to living organisms and affect ecosystems.

Leeward Side

The side of an object or geographical feature that is sheltered from the wind, typically receiving less precipitation and wind.

Evaporation

The process by which water transforms from a liquid to a gas or vapor state, often occurring on the surface of bodies of water under the influence of the sun's heat.

Precipitation

Any form of water that falls from the atmosphere and reaches the ground, including rain, snow, sleet, and hail.