Which of the Following Statements Is False

question 42

Multiple Choice

Which of the following statements is false?

• A) The Capital Asset Pricing Model is the most important method for estimating the cost of capital that is used in practice.
• B) Because the risk that determines expected returns is unsystematic risk, which is measured by beta, the cost of capital for an investment is the expected return available on securities with the same beta.
• C) A common assumption is that the project has the same risk as the firm.
• D) To determine a project's cost of capital we need to estimate its beta.

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Definitions:

Quotas

Preset limits or targets for the amount of goods or people allowed, often used in international trade or immigration policies.

My Lai Massacre

Massacre of 347 Vietnamese civilians in the village of My Lai by Lieutenant William Calley and troops under his command. U.S. army officers covered up the massacre for a year until an investigation uncovered the events. Eventually twenty-five army officers were charged with complicity in the massacre and its cover-up, but only Calley was convicted. He served little time for his crimes.

Nuremberg Trials

A series of military tribunals held after World War II to prosecute prominent leaders of Nazi Germany for war crimes, crimes against humanity, and genocide.

Conservative Agenda

Refers to political goals that emphasize traditional values, limited government, and free market principles.