LKP, Inc, Stock Has an Expected Return of 14

question 1

Multiple Choice

LKP, Inc., stock has an expected return of 14.47 percent. The risk-free rate is 3.8 percent and the market risk premium is 8.6 percent. What is the stock's beta?

• A) 1.19
• B) 1.21
• C) 1.24
• D) 1.28
• E) 1.32

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Definitions:

Discrimination

Discrimination involves unfair or prejudicial treatment of people based on characteristics such as race, age, sex, or disability instead of individual merit.

Eminent Domain

The right of a government to seize private property for public use, with compensation to the owner.

Just Compensation

The fair market value that is required to be paid to an individual for property taken by the government through eminent domain.

Condemn

To officially declare a building or structure as unsafe or unfit for use, or in legal terms, to legally seize private property for public use under the right of eminent domain, with compensation to the owner.