Which One of the Following Statements Is Correct When Treasury

question 104

Multiple Choice

Which one of the following statements is correct when Treasury bills yield 7.5% and the market risk premium is 9.5%?

• A) The S&P 500 would be expected to return 8.50%.
• B) The S&P 500 would be expected to return 9.50%.
• C) The S&P 500 would be expected to return 12.68%.
• D) The S&P 500 would be expected to return 17.00%.

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