THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION

question 102

Multiple Choice

THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION:
A professor of statistics is interested in studying the relationship between the number of hours graduate students spent studying for his comprehensive final exam and the exam score.The results of the regression analysis of hours studied on exam scores are presented below.
-Using financial analysis based on the capital asset pricing model,the required return on an investment is given by:

• A)(Required return on investment)= (risk-free rate)+ [(beta for investment)× ((market return)- (risk-free rate))]
• B)(Required return on investment)= (beta for investment)+ [(risk-free rate)× ((market return)- (beta for investment))]
• C)(Required return on investment)= (beta for investment)+ [(beta for investment)× ((market return)- (risk-free rate))]
• D)(Required return on investment)= (market return)+ [(beta for investment)× ((market return)- (risk-free rate))]

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Definitions:

Raw Material

Basic materials that are used in the production process to create goods or finished products.

Standard Cost

A predetermined cost of manufacturing a single unit or a number of units during a specific time period for budgeting and financial control.

Journalize

The process of recording transactions in the journal of a company, detailing the financial activities.

Manufacturing Overhead Variance

The difference between the actual manufacturing overhead costs incurred and the overhead costs allocated to the production process based on a predetermined rate.