Assume That a Security Is Fairly Priced and Has an Expected

question 106

Multiple Choice

Assume that a security is fairly priced and has an expected rate of return of 0.13.The market expected rate of return is 0.13 and the risk-free rate is 0.04.The beta of the stock is ___.

• A)1.25.
• B)1.7.
• C)1.
• D)0.95.s.
• E)none of the above.

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Definitions:

Reticular Activating System

A network of neurons located in the brainstem that plays a crucial role in regulating arousal and sleep-wake transitions.

Awareness

The knowledge or perception of a situation or fact, often referring to the ability to directly know and perceive, to feel, or to be cognizant of events.

Stream of Consciousness

A literary style or mental process where thoughts and feelings are presented in a continuous flow, mimicking the human mind's natural operation.

Circadian Rhythm

The physical, mental, and behavioral changes that follow a daily cycle, responding primarily to light and darkness in an organism's environment.