A Risky Asset Has a Beta of 1

question 46

Multiple Choice

A risky asset has a beta of 1.58 and an expected return of 17.6 percent. What is the risk-free rate if the risk-to-reward ratio is 8.4 percent?

• A) 2.74 percent
• B) 4.03 percent
• C) 4.33 percent
• D) 5.32 percent
• E) 5.82 percent

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Definitions:

Gender

The range of characteristics pertaining to, and differentiating between, masculinity and femininity, often based on societal norms and individual identity.

Domestic Work

Tasks and chores performed within the home, such as cooking, cleaning, and childcare, often without pay.

Myths

Widely held but false beliefs or ideas, often rooted in tradition or folklore.

Sexual Response

A physiological reaction to sexual stimulation.