There Are Three Key Dimensions to the Business Environment: Financial

question 40

True/False

There are three key dimensions to the business environment: financial, technical, and ethical.

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Definitions:

Risk-free Asset

An investment that is expected to return its full original value along with a specified interest rate with virtually no risk of financial loss.

Beta

An evaluation of the unsteadiness, or systematic jeopardy, of a security or collective financial investments when compared to the market as a whole.

CAPM

The Capital Asset Pricing Model, a formula used to determine the theoretical expected return of an investment given its risk relative to the market.

Risk-free Asset

An investment with zero risk of financial loss, typically considered to be government bonds.