Rainbow Mining Pty Ltd Is Concerned That Opening a New

question 8

Multiple Choice

Rainbow Mining Pty Ltd is concerned that opening a new credit line will affect its share price.Now the company has a risk return on its shares of 17.50%,determined by using a beta factor of 1.50.The risk free rate is 7%.
What is the risk premium for Rainbow Mining?

• A)10.50%
• B)5.50%
• C)7.00%
• D)10.00%
• E)16.00%

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Definitions:

Sensory Memories

the shortest-term element of memory, a repository for incoming sensory information from the environment that holds these stimuli for a very brief period.

Anterograde Amnesia

a condition where an individual is unable to form new memories after the occurrence of a traumatic event or the onset of the condition.

Retrograde Amnesia

A memory disorder characterized by an inability to recall events or information that were acquired before the onset of the amnesia.

Working Memory

A cognitive system responsible for temporarily holding information available for processing, important for reasoning, learning, and comprehension.