A Stock Has an Expected Return of 14

question 23

Multiple Choice

A stock has an expected return of 14.5 percent, the risk-free rate is 4 percent and the return on the market is 11 percent. What is this stock's beta?

• A) 1.5
• B) 3.0
• C) 1.05
• D) 0.94

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Definitions:

Negative Reinforcement

A behavioral concept where the removal of an unfavorable event or condition increases the likelihood of a behavior being repeated.

Positive Reinforcement

A technique in behaviorism where the introduction of a rewarding stimulus following a desired behavior increases the likelihood of it being repeated.

Snake Phobia

An intense, irrational fear of snakes, often leading to avoidance behavior.

Significant Distress

A level of emotional pain or suffering that significantly impacts an individual’s daily functioning or quality of life.