Suppose That Luther's Beta Is 0

question 89

Multiple Choice

Suppose that Luther's beta is 0.9.If the market risk premium is 8% and the risk-free interest rate is 4%,then then expected return for Luther stock is?

• A)7.6%
• B)11.6%
• C)11.2%
• D)12.9%

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Definitions:

Cohesiveness

Refers to the degree of camaraderie within a group.

Productivity

The measure of efficiency in converting inputs into useful outputs, often evaluated in terms of the amount of output produced per unit of input.

Reward Allocation Norms

Guidelines or principles that dictate how rewards such as recognition, salary increases, or promotions are distributed within an organization.

Social Loafing

The tendency of individuals to exert less effort on a task when working in a group than when working alone.