Estimating the Rate of Return for Any Portfolio Lying on the Security

question 45

Multiple Choice

Estimating the rate of return for any portfolio lying on the security market line requires which of the following?

• A)Market rate of return and the portfolio beta
• B)Market rate of return,market beta,and the risk-free rate
• C)Risk-free rate,factor beta,and the industry beta
• D)Factor beta and the market risk premium
• E)Portfolio beta,the risk-free rate,and the market risk premium

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Definitions:

Noble Gases

A group of chemical elements with similar properties under standard conditions, including being odorless, colorless, monatomic gases with very low chemical reactivity.

Inert Gases

A group of gases which are non-reactive under a set of given conditions, including helium, neon, argon, krypton, xenon, and radon.

Atomic Symbols

Symbols assigned to elements based on their names, usually consisting of one or two letters, where the first letter is always capitalized.

Gallium

A soft, silvery metal used in electronics and low melting point alloys.