Suppose the Beta of Microsoft Is 1

question 47

Multiple Choice

Suppose the beta of Microsoft is 1.13,the risk-free rate is 3%,and the market risk premium is 8%.Calculate the expected return for Microsoft.

• A)12.04%
• B)15.66%
• C)13.94%
• D)8.65%

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Definitions:

Bacteria

One of the two prokaryotic domains of life. Domain Bacteria includes organisms such as Escherichia coli and other familiar microbes.

Archaea

One of the two prokaryotic domains of life. Archaea superficially resemble bacteria, but they are distinguished by a number of unique biochemical features.

Genetic Polymorphism

The simultaneous occurrence of two or more discrete phenotypes within a population. In the simplest case, each phenotype results from a different allele or combination of alleles of a single gene. In more complex cases, the phenotypes result from complex interactions between many different genes and the environment.

Phenotypes

The set of visible or measurable traits of an organism that arise from the interaction of its genotype with the environment.