Stock X Has a Beta of

question 43

Multiple Choice

Stock X has a beta of .87 and an expected return of 9.8 percent. Stock Y has a beta of 1.2 and an expected return of 13.1 percent. What is the risk-free rate of return assuming that both stock X and stock Y are correctly priced?

• A) 1.10 percent
• B) 1.20 percent
• C) 2.07 percent
• D) 3.30 percent
• E) 3.50 percent

Understand the concept and purpose of standard costs in business operations.

Calculate and interpret direct materials and labor variances, including price and quantity variances.

Differentiate between favorable and unfavorable cost variances and their implications on business performance.

Recognize the role of budget performance reports in managing organizational finances.

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Definitions:

Price Ceiling

A government-imposed limit on how high a price can be charged on a product, intended to protect consumers from high prices.

Consumers

Consumers are individuals or organizations that acquire goods and services for private purposes.

Price Control

Regulatory measures by which a government intervenes in the market to adjust prices, typically to protect consumers or producers.

Price Ceiling

A maximum price set by the government for certain goods to ensure they remain affordable to the general public.