Assume the Return on Large-Company Stocks Is Currently 11

question 64

Multiple Choice

Assume the return on large-company stocks is currently 11.5 percent.The risk premium on large-company stocks is 8.6 percent and the inflation rate is 2.4 percent.What is the current risk-free rate of return?

• A)2.9%
• B)7.4%
• C)8.4%
• D)10.6%
• E)12.6%

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Definitions:

Employee's Skills

The abilities, knowledge, and competencies that individuals bring to their workplace roles, contributing to the organization's success.

Learning

The process of acquiring new knowledge, behaviors, skills, values, or preferences through study, experience, or teaching.

Outsourcing

The practice of hiring third-party companies or individuals to perform tasks, handle operations, or provide services that are either difficult to manage or are outside the company's expertise.

Employee Morale Risks

The potential negative effects on an organization's performance due to reduced employee satisfaction and engagement.