Use the Following Information to Answer the Question(s)below

question 41

Multiple Choice

Use the following information to answer the question(s) below.
Suppose that the market portfolio is equally likely to increase by 24% or decrease by 8%.Security "X" goes up on average by 29% when the market goes up and goes down by 11% when the market goes down.Security "Y" goes down on average by 16% when the market goes up and goes up by 16% when the market goes down.Security "Z" goes up on average by 4% when the market goes up and goes up by 4% when the market goes down.
-The expected return on security with a beta of 1 is closest to:

• A)-4.0%
• B)3.2%
• C)4.0%
• D)8.0%

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Definitions:

Short Form Truth Table

A condensed version of a truth table that only focuses on the rows that are critical for determining the validity of a logical argument.

Atomic Sentences

Simple sentences that contain no logical connectors and express a single complete thought or proposition.

Truth Values

The assessment of whether a statement is true or false in the field of logic.

Short Form Truth Table

A simplified method of constructing a truth table by focusing only on the rows that are essential for determining validity.