Suppose the Barges Corporation's Common Stock Has an Expected Return

question 4

Multiple Choice

Suppose the Barges Corporation's common stock has an expected return of 12%. Assume that the risk-free rate is 5%,and the market risk premium is 6%. If no unsystematic influence affected Barges' return,the beta for Barges is ______.

• A) 1.00
• B) 1.17
• C) 1.20
• D) 2.50
• E) It is impossible to calculate with the information given.

---

Definitions:

Battery

A civil wrong that occurs when one person intentionally and voluntarily brings about a nonconsented harmful or offensive contact with a person or something closely associated with him or her. Battery requires an actual contact.

Defense of Property

The right to use reasonable force to protect one's property from harm or theft.

Subjective Opinions

Personal views influenced by individual feelings, tastes, or experiences rather than objective facts.

Defamation

The act of damaging the good reputation of someone through false or unjustified statements.