Which of These Is the Line on a Graph of Return

question 2

Multiple Choice

Which of these is the line on a graph of return and risk (standard deviation) from the risk-free rate through the market portfolio?

• A)Capital asset pricing line
• B)Capital market line
• C)Efficient market line
• D)Efficient market hypothesis

Evaluate investment alternatives using the payback period method and the net present value method.

Understand managerial decision-making steps in capital budgeting.

Identify and analyze relevant data for making investment decisions.

Understand and apply the concept of the time value of money in capital budgeting.

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Definitions:

Kilocalories

A unit of energy commonly used to measure the energy content of food, equal to 1,000 calories.

Kinetic Energy

Energy of motion. Compare with potential energy.

Legs

Limbs on animals and humans used primarily for supporting the body and facilitating locomotion or movement.

Motion

The change in position of an object with respect to time and its reference point.