The Risk-Free Rate Is 7 Percent,the Expected Return on the Market

question 32

Multiple Choice

The risk-free rate is 7 percent,the expected return on the market is 10 percent,and the expected return on Security J is 13 percent.What is the beta of Security J?

• A) 0.5
• B) 1.0
• C) 1.5
• D) 2.0
• E) 2.5

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Definitions:

Conscientiousness

A personality trait characterized by carefulness, diligence, and the desire to do a task well.

Punctual

The quality of being on time to appointments or obligations, reflecting a respect for other people's time as well as one's own.

Five-Factor Model

A theory identifying five primary dimensions of personality: openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Conscientiousness

A personality trait characterized by thoroughness, carefulness, and the desire to do a task well.