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:

Communication Process

The sequence of steps or events comprising message creation, transmission, reception, and interpretation by the involved parties.

Intimacy

A close, familiar, and usually affectionate or loving personal relationship with another person or group.

Objectified Others

The concept of viewing and treating people as objects without regard to their personality, dignity, or individuality.

Transference Problem

In psychotherapy, the redirection of a patient's feelings for a significant person to the therapist.