Assume a Firm Has a Beta of 1

question 5

Multiple Choice

Assume a firm has a beta of 1.2.All else held constant,the cost of equity for this firm will increase if the:  

• A)market risk premium decreases.
• B)risk-free rate decreases.
• C)market rate of return decreases.
• D)beta decreases.
• E)either the risk-free rate or the market rate of return decreases.

---

Definitions:

Independent Role

A function or position that operates autonomously or independently, often referring to professions or duties that do not require supervision.

Professional Nurses

Licensed individuals who have completed rigorous nursing education and training to provide healthcare services.

Health-care Providers

Professionals and facilities that offer health-related services to individuals, including medical treatment, diagnosis, and preventive care.

Human Transaction

Interactions between individuals that involve exchange or communication, often considered in social, psychological, and economic contexts.