Your Estimate of the Market Risk Premium Is 7

question 45

Multiple Choice

Your estimate of the market risk premium is 7%.The risk-free rate of return is 4% and General Motors has a beta of 1.5.What is General Motors' cost of equity capital?

• A)13.5%
• B)14.5%
• C)13.9%
• D)14.8%

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Definitions:

Directive-assertive

A communication style characterized by direct expressions of needs and wants, often with the expectation of compliance from others.

Passive

A state of acceptance or non-resistance to external events or situations, often implying a lack of active response.

Aggressive

Characterized by or resulting from a forceful and sometimes overly assertive pursuit of one's goals.

Johari Window

A psychological tool that helps individuals understand their relationship with themselves and others by categorizing known and unknown aspects of their personality.