If the ICAPM Beta Is 0 $6.0 \%$ B) $8.8 \%$

question 26

Multiple Choice

If the ICAPM beta is 0.8,and the world market return and risk-free rate are 12% and 5% respectively,then the expected return predicted by the ICAPM is:

• A) \( 6.0 \% \)
• B) \( 8.8 \% \)
• C) \(10.6 \% \)
• D) \( 12.4 \% \)

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Definitions:

Credit Card

A plastic card issued by a bank allowing the holder to purchase goods or services on credit.

Rate Of Return

The financial increment or decrement experienced in the value of an investment over a specific duration, highlighted as a percentage of the initial capital deployed.

Business Venture

A new enterprise entered into for profit, often characterized by innovation, risk, and a new market or product.

Compounded Semi-annually

The process of calculating interest on both the initial principal and the accumulated interest from previous periods twice a year.