If an Asset Being Considered for Acquisi¬tion Has Beta of Zero

question 34

True/False

If an asset being considered for acquisi¬tion has beta of zero, its purchase will have no effect on the firm's market risk.

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Definitions:

Rhizoids

Rhizoids are small, root-like structures found in non-vascular plants, fungi, and some protists that anchor them to surfaces and absorb nutrients.

Gametophyte

The sexual phase in the life cycle of plants and algae that produces gametes through mitosis.

Prothalli

The gametophyte stage of ferns and some other non-seed plants, which is free-living and bears the sex organs.

Gemmae

Tiny balls of tissue (borne in gemmae cups) used for asexual reproduction by liverworts.