Use the Information for the Question(s)below

question 102

Multiple Choice

Use the information for the question(s) below.
Sisyphean industries is seeking to raise capital from a large group of investors to fund a new project.Suppose that the efficient portfolio has an expected return of 14% and a volatility of 20%.Sisyphean's new project is expected to have a volatility of 40% and a 70% correlation with the efficient portfolio.The risk-free rate is 4%.
-The required return for Sisyphean's new project is closest to:

• A)24%.
• B)14%.
• C)18%.
• D)10%.

---

Definitions:

Future Favors

The expectation or arrangement of receiving help, support, or advantage at a later time, as a return for one's current action or service.

American Concept

Refers to ideals and values commonly associated with the United States, such as freedom, democracy, and individualism.

Principle of Utilitarianism

A moral principle that proposes the optimal action is the one that enhances overall happiness, commonly understood as the action that results in the highest level of well-being for the largest group of individuals.

Prejudice

The outcome of prejudging a person. Prejudice in communication is the unwillingness to listen to members of groups the listener believes are inferior, such as other ethnic groups or women; it can also take more subtle forms; how you feel as a result of the stereotypes you believe in.