XYZ Corp Has an Expected Return of 16

question 62

Multiple Choice

XYZ Corp has an expected return of 16%.If the risk free rate is 4.5% and the return for the market is 20%,calculate the Beta for XYZ.

• A) 1.35
• B) 0.86
• C) 0.74
• D) 1.12
• E) 0.95

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Definitions:

Option To Wait

The flexibility to delay an investment or project to gather more information or wait for favorable conditions.

Discount Rate

The discount rate applied in DCF analysis to calculate the current worth of anticipated future cash flows.

Option To Wait

A strategic decision opportunity in investment where the investor can delay an investment decision to gather more information or for conditions to improve.

Soft Capital Rationing

Internal constraints imposed by a company's management on the funds allocated for new investments, often due to budgetary constraints.