What Is the Expected Return on a Stock with a Beta

question 55

Multiple Choice

What is the expected return on a stock with a beta of 0.8,given a risk free rate of 3.5% and an expected market return of 15.5%?

• A) 3.8%
• B) 13.1%
• C) 15.6%
• D) 19.1%

---

Definitions:

Balance Sheet

A financial statement that displays a company's financial position at a specific point in time, detailing assets, liabilities, and shareholders' equity.

Income Statement

A financial report that shows a company's revenues, expenses, and net income over a specific period.

Investee

A company or entity in which an investment is made, typically signifying a minority interest.

Progressives

Advocates for social reform and political change aimed at improving the conditions and fairness of society, historically seen in movements for labor rights, suffrage, and elimination of corruption.