Joe Purchased 800 Shares of Robotics Stock at $3 Per

question 42

Multiple Choice

Joe purchased 800 shares of Robotics Stock at $3 per share on 1/1/09.Bill sold the shares on 12/31/09 for $3.45.Robotics stock has a beta of 1.9,the risk-free rate of return is 4%,and the market risk premium is 9%.The required return on Robotics Stock is

• A) 15.0%.
• B) 16.5%.
• C) 17.6%.
• D) 21.1%.

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Definitions:

Directional Selection

Outcome of natural selection in which an extreme phenotype is favored, usually in a changing environment.

Cladogram

In cladistics, a branching diagram that shows the relationship among species in regard to their shared derived characters.

Common Ancestor

An ancestral species from which two or more species evolved.

Natural Selection

The process by which organisms better adapted to their environment tend to survive and produce more offspring, a fundamental concept in evolutionary biology.