Required Return If the Risk-Free Rate Is 8 Percent and the Market

question 84

Multiple Choice

Required Return If the risk-free rate is 8 percent and the market risk premium is 2 percent, what is the required return for the market?

• A) 2%
• B) 6%
• C) 8%
• D) 10%

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Definitions:

Just-in-Time Inventory

Just-in-Time Inventory is an inventory management strategy that aims to increase efficiency and decrease waste by receiving goods only as they are needed in the production process.

Total Quality Management

Total Quality Management (TQM) is an organization-wide approach focused on continuous improvement and meeting customer satisfaction through systematic problem-solving and team-based collaborative efforts.

Operations

Activities involved in the day-to-day functions of a business that are necessary for it to run efficiently and effectively.

EOQ

Economic Order Quantity, the ideal order quantity a company should purchase to minimize its inventory costs, including holding and ordering costs.