Use the Information for the Question(s)below

question 88

Multiple Choice

Use the information for the question(s) below.
Suppose that in the coming year,you expect Exxon-Mobil stock to have a volatility of 42% and a beta of 0.9,and Merck's stock to have a volatility of 24% and a beta of 1.1.The risk-free interest rate is 4% and the market's expected return is 12%.
-The cost of capital for a project with the same beta as Exxon Mobil's stock is closest to:

• A)11.6%.
• B)11.2%.
• C)12.8%.
• D)7.6%.

---

Definitions:

Competitive Intelligence

The process of gathering, analyzing, and using information about competitors, market trends, and the business environment to make strategic decisions.

Espionage

The act of secretly gathering sensitive or classified information from individuals or organizations for personal or political gain.

Cybercrime

Illegal activities conducted through the internet or other forms of digital communication, including fraud, hacking, and identity theft.

Piracy

The unauthorized use or reproduction of someone else's work, such as software, music, or movies, without permission.