Use the Information for the Question(s)below

question 124

Multiple Choice

Use the information for the question(s) below.
Suppose that the risk-free rate is 5% and the market portfolio has an expected return of 13% with a volatility of 18%.Monsters Inc.has a 24% volatility and a correlation with the market of .60,while California Gold Mining has a 32% volatility and a correlation with the market of -.7.Assume the CAPM assumptions hold.
-Monsters' required return is closest to:

• A)10.0%.
• B)13.0%.
• C)11.5%.
• D)15.5%.

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Definitions:

Emotion-Focused Coping

A coping strategy that involves identifying and expressing emotions associated with stress and seeking emotional support from others, rather than directly addressing the source of stress.

Adaptation-Level Phenomenon

The psychological process by which an individual's expectations and standards adjust based on past experiences, influencing their perception of new stimuli.

Internal Locus

The belief that one has control over their life events and outcomes, rather than external forces having that control.

Relative Deprivation

A psychological condition where individuals feel disadvantaged or deprived when comparing themselves to others who they perceive as better off.