Zacher Co'S Stock Has a Beta of 1

question 71

Multiple Choice

Zacher Co.'s stock has a beta of 1.40, the risk-free rate is 4.25%, and the market risk premium is 5.50%.What is the firm's required rate of return?

• A) 11.36%
• B) 11.65%
• C) 11.95%
• D) 12.25%
• E) 12.55%

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Definitions:

UCC

The Uniform Commercial Code, a comprehensive set of laws governing commercial transactions in the United States, aimed at harmonizing statutes across states.

Sale of Goods

The sale of goods entails the transaction and transfer of ownership of tangible personal property from a seller to a buyer in exchange for a payment.

Parol Evidence Rule

The parol evidence rule is a legal doctrine that prevents parties to a written contract from presenting external evidence that contradicts or adds to the written terms of the contract.

UCC

Stands for Uniform Commercial Code, a comprehensive set of laws governing all commercial transactions in the United States.