Zacher Co'S Stock Has a Beta of 1

question 19

Multiple Choice

Zacher Co.'s stock has a beta of 1.40, the risk-free rate is 4.25%, and the market risk premium is 5.50%.What is the firm's required rate of return?

• A) 11.36%
• B) 11.65%
• C) 11.95%
• D) 12.25%
• E) 12.55%

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Definitions:

Derogatory

Expressing a low opinion or negative judgment intended to diminish the value, reputation, or esteem of a person or thing.

Employee's Demeanor

The way an employee behaves or conducts themselves at work, which can reflect on their professionalism and the company's image.

Cold

Characterized by a low temperature; often associated with discomfort or the absence of warmth in the context of weather, environments, or sensations.

Concierge Company

A business that provides specialized services to clients, often in luxury hospitality, such as personal assistance or lifestyle management.