Small Company Stocks Are Yielding 15

question 81

Multiple Choice

Small company stocks are yielding 15.7% while the U.S. Treasury bill has a 4.3% yield and a bank savings account is yielding 3.8%. What is the risk premium on small company stocks?

• A) 7.6%
• B) 11.4%
• C) 11.9%
• D) 15.7%

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Definitions:

Positive Correlation

A relationship between two variables where both either increase or decrease together, indicating a direct association.

Low Score

Low score typically refers to results that fall below an expected or average range in assessments or tests.

Mode

The value that appears most frequently in a data set or distribution.

Distribution of Scores

The way in which scores are spread out or dispersed across a range in a dataset, often visualized with graphs.