What Is the Beta for a Portfolio with an Expected

question 78

Multiple Choice

What is the beta for a portfolio with an expected return of 12.5%?

• A) 0
• B) 1
• C) 1.5
• D) 2

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Definitions:

Capital Lease

A contractual arrangement that transfers substantially all the benefits and risks of ownership to the lessee so that the lease is in effect a purchase of the property.

Plant Assets

Long-term tangible assets used in the operation of a business, such as buildings, machinery, and equipment.

Loss On Redemption

A financial loss experienced when redeeming bonds or securities before their maturity date for a price higher than their face value.

Carrying Value

The book value of an asset or liability on a company's balance sheet, calculated as its original cost minus any depreciation, amortization, or impairment costs.