Diddy Corp

question 59

Multiple Choice

Diddy Corp. stock has a beta of 1.0, the current risk-free rate is 5 percent, and the expected return on the market is 15.5 percent. What is Diddy's cost of equity?

• A) 15.50 percent
• B) 14.20 percent
• C) 18.50 percent
• D) 16.30 percent

---

Definitions:

Years Ago

A phrase used to denote a specific amount of time in the past counting backward from the current date.

Economic Sectors

The distinct areas of economic activity within an economy, such as agriculture, manufacturing, and services, each contributing to the overall economy.

Basic Sector

Economic activities that provide goods and services beyond the local market, contributing to a region's economic growth by bringing in external income.

Primary Sector

The sector of an economy involving the extraction and collection of natural resources, such as agriculture, forestry, fishing, and mining.