The Excess Return Earned by an Asset That Has a Beta

question 60

Multiple Choice

The excess return earned by an asset that has a beta of 1.34 over that earned by a risk-free asset is referred to as the:

• A) market risk premium.
• B) risk premium.
• C) systematic return.
• D) total return.
• E) real rate of return.

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Definitions:

Experiment

A scientific procedure undertaken to test a hypothesis, involving manipulation of one or more variables to measure their effect on certain outcomes.

Debate

A formal discussion on a specific topic where opposing arguments are put forward by individuals or teams.

Statistical Inference

The process of using data from a sample to make estimates or test hypotheses about the characteristics of a population.

Observations

Collected data points or recorded measurements in a study or experiment.