What Will Happen to a Stock That Offers a Lower

question 4

Multiple Choice

What will happen to a stock that offers a lower return than predicted by the CAPM?

• A) Its beta will increase.
• B) Its beta will decrease.
• C) Its market price will decrease causing its yield to increase.
• D)Its market price will increase causing its yield to increase.

---

Definitions:

AIDS Virus

Human Immunodeficiency Virus (HIV), which causes acquired immunodeficiency syndrome (AIDS), a condition where the immune system fails, leading to life-threatening infections.

University of Washington

A public research university located in Seattle, Washington, known for its advanced research facilities and diverse academic programs.

Transitional Expression

Words or phrases used to connect ideas in writing, helping it flow more smoothly by indicating relationships between sections or sentences.

Transitional Expression

Phrases or words used to link sentences and paragraphs smoothly, guiding the reader through the text.