Without Using a Calculator,solve the Following Problem:

question 129

Multiple Choice

Without using a calculator,solve the following problem:

• A) 1 × 10⁸
• B) 1 × 10¹
• C) 1 × 10^-13
• D) 1 × 10^-20

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Definitions:

Risk Premium

The extra return expected by an investor for holding a higher-risk investment over a risk-free asset.

Factor Portfolios

Investment portfolios constructed to have a high sensitivity to certain factors or characteristics expected to yield higher returns, such as size, value, or momentum.

Pricing Model

A theoretical approach used to determine the price of a financial instrument or the valuation of a company.

Risk-Free Rate

The risk-free rate is the theoretical rate of return of an investment with zero risk, serving as a benchmark for measuring financial instruments' risk.