The Stock of Big Joe's Has a Beta of 1

question 50

Multiple Choice

The stock of Big Joe's has a beta of 1.14 and an expected return of 11.6%. The risk-free rate of return is 4%. What is the expected return on the market?

• A) 7.60%
• B) 8.04%
• C) 9.33%
• D) 10.67%
• E) 12.16%

---

Definitions:

Cooperativeness

A personality trait that reflects how much a person is willing to work together with others towards common goals or interests.

Neuroticism

A personality trait characterized by emotional instability, anxiety, moodiness, irritability, and vulnerability to stress.

Decrease

A reduction in size, quantity, or intensity of something.

College

An institution of higher education offering undergraduate programs, typically leading to associate or bachelor's degrees.