Your Estimate of the Market Risk Premium Is 6

question 79

Multiple Choice

Your estimate of the market risk premium is 6%.The risk-free rate of return is 5% and General Motors has a beta of 1.2.What is General Motors' cost of equity capital?

• A)12.2%
• B)11.8%
• C)12.9%
• D)11.4%

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Definitions:

Hierarchy Of Needs

A motivational theory in psychology comprising a five-tier model of human needs, from physiological to self-actualization, proposed by Abraham Maslow.

Maslow

Maslow refers to Abraham Maslow, a psychologist best known for formulating the hierarchy of needs, a theory of psychological health predicated on fulfilling innate human needs in priority, culminating in self-actualization.

Basic Needs

Fundamental requirements for human survival and well-being, such as food, water, shelter, and safety, which are essential for maintaining life.

Rogers

A psychologist known for developing the person-centered approach to therapy, emphasizing the human potential for growth, self-understanding, and psychological healing.