Securities with Betas Greater Than L Should Have

question 4

Multiple Choice

Securities with betas greater than l should have:

• A)expected returns higher than the market.:::::
• B)required returns higher than the market return.
• C)required returns lower than the market return.
• D)no systematic risk.

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Definitions:

Common Law

A legal system based on judicial precedents and customs rather than statutory laws.

Tort Liability

Legal responsibility that arises from the commission of a tort, which is a civil wrong, such as negligence, that causes harm to another.

Negligence

The failure to exercise a level of care that a reasonably prudent person would in similar circumstances, potentially causing harm or damage.

Sarbanes-Oxley Act

A U.S. federal law enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures in financial statements and other corporate events.