What Is the Expected Return for a Real Estate Investment

question 25

Multiple Choice

What is the expected return for a real estate investment fund with a Beta of 1.87,given a risk free rate of 2.7% and an expected return of 11.2% for the market?

• A)18.6%
• B)11.2%
• C)15.9%
• D)2.7%

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Definitions:

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, providing a basis for computing rates of return and evaluating its capital structure.

Current Ratio

A financial ratio indicating how well a firm can cover its short-term liabilities with its present assets.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of a business, whichever is longer.

Current Liabilities

Financial obligations a company is expected to settle within one year or within its normal operating cycle, whichever is longer.