You Are Considering an Investment in First Allegiance Corp

question 43

Multiple Choice

You are considering an investment in First Allegiance Corp.The firm has a beta of 1.6.Currently,U.S.Treasury bills are yielding 2.75% and the expected return for the S & P 500 is 14%.What rate of return should you expect for your investment in First Allegiance?

• A) 11.15%
• B) 15.39%
• C) 16.75%
• D) 20.75%

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Definitions:

Ovaries

Female reproductive organs that produce eggs and secrete hormones like estrogen and progesterone.

Testes

Male reproductive glands responsible for producing sperm and sex hormones.

Central Nervous System

The complex of nerve tissues that controls the activities of the body. In vertebrates it comprises the brain and spinal cord.

Sympathetic Nervous System

Part of the autonomic nervous system that regulates involuntary responses by stimulating activities associated with the fight-or-flight response.